Wednesday, September 16, 2009

Taking the Market Out of Irish Housing

We think we’ve got a problem. I’m in Ireland for the national social housing conference and the mood is sombre. The housing market in Ireland overheated to a quite phenomenal degree, and is now in full-scale retreat. The damage it has caused is what I have been asked here to talk about. Estimates vary, but even the most conservative say that 200,000 surplus flats have been built. Added to Ireland’s already sizeable empty homes problem it means there could be anything up to 400,000 homes standing empty. The quite extraordinary plan to be unveiled by the housing minister here in a couple of hours, is for the state to effectively take them over. The government has set up NAMA The National Asset Management Authority. It plans to take on €90 billion of property on 20-year leases and let them to those in housing need. It’s an incredibly bold move. But there are plenty here who also think it’s insane. The opening session of this conference yesterday was entitled "taking the market out of housing" That appears to be exactly what they are planning.

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