A reluctance to forclose would put bank earnings under even more pressure in a downturn.
With their vast stockpiles of cash from Sale-Leasebacks they can afford to buy back shares if there's a significant move downwards...I wonder if short activity is building in Irish bank shares as the signs of a weakening property market are becoming more prevalent.
A reluctance to foreclose would put bank earnings under even more pressure in a downturn. I wonder if short activity is building in Irish bank shares as the signs of a weakening property market are becoming more prevalent.
A reluctance to foreclose would put bank earnings under even more pressure in a downturn. I wonder if short activity is building in Irish bank shares as the signs of a weakening property market are becoming more prevalent.
I'm sure this attitude might change though if more and more stopped paying. In the main lenders prefer to negotiate...might let you pay interest only, or take a 'holiday' on payments until your finances stabilise.
More evidence of higher rates to come next year.
Industrial production in Germany increasing.
http://www.bloomberg.com/apps/news?pid=20601009&sid=apt5l7KIlaF0&refer=bond
Will the media be warning homeowners?
.... In either scenario they can't lose. If they have to repossess and it takes 2 years, presumably they are paying for the money they lent you in the interim period i.e. for the length of time it takes them to actually repossess the house! They get it all back when house is sold of course but I'm sure they'd prefer money in the coffers now rather than later!
I hear both these arguments a lot in Ireland as part of "it's different here" pitches. I disagree with both of them.
On the first point, the absolute rate of interest is pretty irrelevant imho. It is all about affordability, not the absolute rate. Yes, UK rates were at 15% at the end of the crash period, but affordability rather than interest rates per se was the problem -affordability was going above 40% of net income. The prices themselves relative to income were lower than we have in Ireland today but because the IR's were so high, the net income percentage was high.
As many commentators have reported, we are now at the limit of affordability in Ireland, even though our base rate is 3.25%. So you could argue we are in a worse position, not a better one.
Second, 120% mortgages were certainly not readily available to everyday punters. 100% mortgages were but IO and other "exotic" forms of financing were not commonplace. BTL was also very rare.
My recollection is that 100%+ mortgages were marketed after the crash so people could "buy" their negative equity and move out of their homes.
Some American hedge funds have begun shorting Anglo Irish if I remember correctly.
With their vast stockpiles of cash from Sale-Leasebacks they can afford to buy back shares if there's a significant move downwards...
of course they should be investing the money in the American Dream
[broken link removed]
"The most gargantuan feature, though, is the price tag of a cool $125 million (€98.5 million), and it’s not even the most expensive on offer - another mega-house in Aspen, Colorado, is now listed at $135 million (€106 million)"
i took a lot of cr**p from couple of posters yesterday, now i am showing a lot of patience not to reply to this post.
sorry room305
room305 apologies if my previous message sounds like a personal attack,Some American hedge funds have begun shorting Anglo Irish if I remember correctly.
I think that if anyone thinks that an Irishman or woman will meekly be put out of their homes on the instructions of the agents of 'foreign interests' is either a foreigner or a very, very, very poor student of Irish history. The depth of feeling, the historical resonance imagine it.
i took a lot of cr**p from couple of posters yesterday, now i am showing a lot of patience not to reply to this post.
sorry room305
room305 apologies if my previous message sounds like a personal attack,
as i have shown in my previous message short interest has gone down in the last two months, plus if a hedge fund is shorting hardly means anything because someone else was buying those shares.
Does these arguments hold ?
in worst case currently affordability is 40% net income(in dublin), and thats hitting levels seen in 80's,
A hard landing in US will lead to weaker interest rates, weaker dollar and ECB stops raising rates as German export led growth stalls. China also slows and oil demand drops some and inflation goes back in the box. this would help the property pyramid here even if some job losses as per ersi
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