# Unsold new apartment blocks; the irish "sub-prime" for banks?



## p45 (30 Sep 2008)

What banks have funded all these empty developements?   Within a short radius of where I am there are many empty complexes complete and almost; a tower at the Blackhouse luas stop, the new Fatima mansions, Landsowne valley, the old Islandbridge army barracks.  Every area must have it's share of these.


----------



## csirl (30 Sep 2008)

I've no confidence in the "vacant" apartment blocks figures. Anecdotal evidence suggests that a very high proportion of "vacant" apartments are occupied by tenants of landlords who operate for cash and are not declaring tax/registered with PRTB. 

The figures used by officialdom are based on declared tenants by legally compliant landlords and take no account of the undeclaring landlords.

Census figures have the same flaws - these landlords instruct their tenants not to fill in census forms.


----------



## ubiquitous (30 Sep 2008)

csirl said:


> I've no confidence in the "vacant" apartment blocks figures. Anecdotal evidence suggests that a very high proportion of "vacant" apartments are occupied by tenants of landlords who operate for cash and are not declaring tax/registered with PRTB.



That may be the case to a certain extent, but if you walk or drive through any Irish town or city (and indeed many villages), you will notice large numbers of new apartments and houses that don't have any evidence of people living in them, eg, no curtains on windows etc. On top of that, many have (increasingly forlorn) "for sale" signs and banners attached. I refuse to believe that there are tenants hiding under the beds in many of these properties.


----------



## Berni (30 Sep 2008)

csirl said:


> Census figures have the same flaws - these landlords instruct their tenants not to fill in census forms.


 
I think you're underestimating the effort that the census enumerators put into addressing this issue. Where a property appeared unoccupied, enquiries were made with the local postman, neighbours, etc, before it was deemed to be empty. 

If there really are people living in them, then they never answer their door or receive post, and must be ideal neighbours because they make no noise and only come and go under cover of darkness!


----------



## ubiquitous (30 Sep 2008)

Berni said:


> If there really are people living in them, then they never answer their door or receive post, and must be ideal neighbours because they make no noise and only come and go under cover of darkness!



..and never turn on lights


----------



## rmelly (30 Sep 2008)

ubiquitous said:


> ..and never turn on lights


 
plus don't use their parking, don't have curtains etc.


----------



## LennyBriscoe (30 Sep 2008)

Perhaps a ridiculous idea but maybe more accurate figures may be availble from the ESB - any unit below a certain threshold could be deamed as empty...


----------



## csirl (30 Sep 2008)

> I think you're underestimating the effort that the census enumerators put into addressing this issue. Where a property appeared unoccupied, enquiries were made with the local postman, neighbours, etc, before it was deemed to be empty.
> 
> If there really are people living in them, then they never answer their door or receive post, and must be ideal neighbours because they make no noise and only come and go under cover of darkness!


 
There was a big issue during the census with enumerators complaining that they could not access large apartment blocks i.e. walk around the hallways and knock on doors. All they could do is leave the census forms in post boxes and hope for a reply.

Take your typical large apartment development with 10s if not 100s of apartments in a building complex with underground carpark and pedestrian entrance opening onto street. Unless you own or rent an apartment, you cannot even get into the complex. Many apartments are not even visible to the public e.g. at rear or opening onto internal courtyard. My office is near a lot of apartment blocks in Dublin city centre, including a couple of developments where the media are claiming have a high level of vacancy. The ones visible from the street or adjacent properties are all kitted out with blinds/net curtains. There is no way to tell from the exterior if they are occupied or not. But you can see a steady stream of people going in/out etc. Judging by the fact that migrant workers hauling suitcases into these complexes is a very very common sight around this area it would appear that, while turnover may be high, business appears to be brisk.

I accept that in smaller developments in rural areas, it is easy to tell and maybe they are vacant, but there is no evidence of same in Dublin.


----------



## oceanclub (30 Sep 2008)

rmelly said:


> plus don't use their parking, don't have curtains etc.


 
There's a children's story in this idea:

_"Canny McSavvy & The Invisible Apartment Pixies"_

P.


----------



## ubiquitous (30 Sep 2008)

csirl said:


> I accept that in smaller developments in rural areas, it is easy to tell and maybe they are vacant, but there is *no evidence* of same in Dublin.



No evidence? So the OP is mistaken?



p45 said:


> What banks have funded all these empty developements?   Within a short radius of where I am there are *many empty complexes complete and almost; a tower at the Blackhouse luas stop, the new Fatima mansions, Landsowne valley, the old Islandbridge army barracks*.  Every area must have it's share of these.


----------



## Purple (30 Sep 2008)

Add to that the half completed complexes allm over the country...


----------



## Berni (30 Sep 2008)

csirl said:


> I accept that in smaller developments in rural areas, it is easy to tell and maybe they are vacant, but there is no evidence of same in Dublin.


 
So you think approx 10% of all housing stock in Dublin is occupied by these stealth tenants? Or that the CSO imagined them?
[broken link removed]

How do the 16,000+ places to rent in Dublin tie into your 100% occupancy theory?  http://daftwatch.atspace.com/

I accept that gated apartments made life difficult for enumerators, but in general in complexes such as you describe, there is an intercom system at the gate.


----------



## csirl (30 Sep 2008)

What about the disconnect between the official figures of residents of this country and the numbers claimed by various embassies? These people must live somewhere e.g.

http://www.entemp.ie/labour/workpermits/statistics.htm

According to the Dept of Enterprise Trade & Employment, there are currently only 489 Chinese working in Ireland.


----------



## Berni (30 Sep 2008)

So all these apparently empty apartment blocks are actually packed to the rafters with foreign nationals being oppressed by their tax evading landlords?


----------



## rmelly (30 Sep 2008)

csirl said:


> What about the disconnect between the official figures of residents of this country and the numbers claimed by various embassies? These people must live somewhere e.g.
> 
> http://www.entemp.ie/labour/workpermits/statistics.htm
> 
> According to the Dept of Enterprise Trade & Employment, there are currently only 489 Chinese working in Ireland.


 
Does this include students? I think (?) they can legally work a certain number of hours?


----------



## Purple (30 Sep 2008)

Berni said:


> So all these apparently empty apartment blocks are actually packed to the rafters with foreign nationals being oppressed by their tax evading landlords?


...and exploited by their fat-cat profiteering employers


----------



## csirl (30 Sep 2008)

> So all these apparently empty apartment blocks are actually packed to the rafters with foreign nationals being oppressed by their tax evading landlords?


 
I'd say its more symbiotic.

I've a friend who's got a number of rental properties. When he advertises for new tenants in any of them, he's always gets a couple of calls from "agents" in China wanting to rent for "clients" - cash in hand, no questions asked. (He never accommodates them).


----------



## Bronte (1 Oct 2008)

csirl said:


> I'd say its more symbiotic.
> 
> I've a friend who's got a number of rental properties. When he advertises for new tenants in any of them, he's always gets a couple of calls from "agents" in China wanting to rent for "clients" - cash in hand, no questions asked. (He never accommodates them).


 I'm confused as to what you mean - are you referring to the 'massage parlours' or do you mean illegal foreign workers put 10 to a room by their employer?


----------



## ccbkd (1 Oct 2008)

Ah now csirl, The Atheist whistling as he Passes the Graveyard Syndrome! 

Please can I borrow those rose-tinted glasses that make empty apartment blocks in Lucan, Clonee and Swords look occupied!


----------



## csirl (1 Oct 2008)

> I'm confused as to what you mean - are you referring to the 'massage parlours' or do you mean illegal foreign workers put 10 to a room by their employer?


 
Referring to foreign workers. Not necessarily illegal, though many probably are.


----------



## ubiquitous (1 Oct 2008)

csirl said:


> Referring to foreign workers.



Well they would say that wouldn't they? If they're running brothels, they're hardly likely to tell your friend this over the phone?


----------



## ccbkd (1 Oct 2008)

haha, I think cisrl was trying vainly to suggest that there was there was life in the Dublin Property market but inadvertently opened a can of worms.. so all these empty apartment Blocks are being used as Brothels while unsuspecting landlord collect untaxed rent...


----------



## csirl (1 Oct 2008)

> Well they would say that wouldn't they? If they're running brothels, they're hardly likely to tell your friend this over the phone?


 
Never thought of it this way 

Is this more common than most people realise?


----------



## oceanclub (1 Oct 2008)

It just goes to show the level of denial in this country is astonishing. There's a report today that in the UK, apartment prices have been slashed by up to 43%:

http://www.telegraph.co.uk/finance/...lopment-slashes-43pc-off-property-prices.html


> _The investment bank claims to have seen copies of a sales document sent by Barratt Developments' Yorkshire East division to property professionals *offering up to 43pc off* specific properties to buyers prepared to buy five or more flats or houses._
> 
> _Analyst Alastair Stewart said: "Prices of urban apartments appear to have fallen in many cases by 40pc to 50pc, volumes have dried up to virtually zero, many developers have gone bust and land in many cases appears to be worthless."_
> 
> ...


 
Remember when those who said prices would drop 50% were considered to be lunatics?

But of course, the Irish property boom is a whole new paradigm, rent is dead money, safe as houses, etc.

Oh, as for the excuse that all those empty apartments are actually full of hookers... I can only clap my hands in admiration at that bear of bearishness. Perhaps Adamstown should be renamed "Monto"?

P.


----------



## Bronte (1 Oct 2008)

csirl said:


> Never thought of it this way
> 
> Is this more common than most people realise?


 It wouldn't be a good rental market, dealing with dicy people, meat cleavers etc.  There actually wouldn't be a lot of apartments wanted certainly couldn't fill an apartment block and tenants tend to be transient and get moved on every couple of months by the police.  Also in these reccessionary times this will have to be one of the punter's expensive habits to forego so leading to less demand for apartments.  Is there a big market for the pack the foreigners in like sandwiches brigade, I would have thought that was more likely in older building and not new apartment blocks.  I'm not a fan of the PRTB but I thought they were apparently making sure that no rental property went unregistered.  Are there really vast amounts of apartments unsold? What is keeping the builders from selling?


----------



## Towger (1 Oct 2008)

csirl said:


> Never thought of it this way
> 
> Is this more common than most people realise?


 
We had this problem a few years back. Just rented to a normal couple, or so we thought. After a few months we started to get anonymous phone calls in the middle of the night, claiming brothel was being run there. They (the couple) claimed the wife had a massage business on the side. Maybe she did extras! The bed had vanished and a massage table had appeared in one of the bed rooms. Never any problem with payments and they left after a few months after that.


----------



## ubiquitous (1 Oct 2008)

Bronte said:


> Are there really vast amounts of apartments unsold? What is keeping the builders from selling?



Where have you been for the past year


----------



## JohnBoy (1 Oct 2008)

Bronte said:


> It wouldn't be a good rental market, dealing with dicy people, meat cleavers etc. There actually wouldn't be a lot of apartments wanted certainly couldn't fill an apartment block and tenants tend to be transient and get moved on every couple of months by the police. Also in these reccessionary times this will have to be one of the punter's expensive habits to forego so leading to less demand for apartments. Is there a big market for the pack the foreigners in like sandwiches brigade, I would have thought that was more likely in older building and not new apartment blocks. I'm not a fan of the PRTB but I thought they were apparently making sure that no rental property went unregistered. Are there really vast amounts of apartments unsold? What is keeping the builders from selling?


 
Best guesstimate of the stock of unoccupied property in Ireland is approx 10%-15% of all properties nationally (check the results of the 2006 Census and add much of the building done since then - perhaps 300k-350k in total). What % of these are for sale is difficult to judge but there is probably about 24 months of 'normal' supply on the market at the moment. Some builders have broken ranks and slashed their prices but the majority have not. On the demand side, mortgages are more difficult to get, and when you do get approved it is likely to be for a lower amount than would have been available say 18 months ago.

The builders can afford to hold on because the banks have let them.


----------



## ccbkd (1 Oct 2008)

ubiquitous said:


> Where have you been for the past year


 
I think he was being Ironic!


----------



## Bronte (2 Oct 2008)

I was trying to elicit what the quantity of vast is.  Yes I know builders are vailiantly trying to hold onto many apartments with banks having a gun to their heads to prevent them dropping the price, and both sides (banks and builders) are just waiting until the budget sorts it all out for them and then we'll see what happens.  Maybe a few purchasers will appear after that.  And after that it will get even more interesting.


----------



## ccbkd (2 Oct 2008)

Bronte said:


> I was trying to elicit what the quantity of vast is. Yes I know builders are vailiantly trying to hold onto many apartments with banks having a gun to their heads to prevent them dropping the price, and both sides (banks and builders) are just waiting until the budget sorts it all out for them and then we'll see what happens. Maybe a few purchasers will appear after that. And after that it will get even more interesting.


 
Bronte you speak in riddles


----------

