With NAMA set to swing into operation, this post outlines the elephant in the room for NAMA: yields on Irish property. It also discusses how NAMA could still work for taxpayers – if those working for NAMA ensure that they make themselves fully aware of the true yields on various types of Irish property and how those yields may correct themselves over coming years.
The latest Daft Report shows that rents in all parts of the country have actually stabilised since November, a surprise given the apparent excess of properties in large parts of the country. This post discusses whether the January figure is more likely to prove seasonal or structural, before outlining the importance of stable rents for the broader property market and economy.
This post reviews the latest Daft rental report, which finds that rents are at their lowest level in almost 10 years. Rents have fallen in Dublin by more than other parts of the country, while the total stock available to rent has fallen 10% in recent months. Some implications for NAMA are also explored, before underscoring the good news for tenants this news represents.
Recently, there have been some suggestions about NAMA buying up and renting out thousands of properties from its portfolio. This post goes through those suggestions and explores why it is a bad idea for the taxpayer, in that it amounts to doubling up on the NAMA gamble with developers as well as with the banks.
With the NAMA draft business plan released earlier this week, this post reviews a key topic that remains unaddressed: the low yields on residential property. It finds that yields are clearly lower – far lower – than the 6% assumed both at the start of the NAMA process and now, in its business plan.
This post examines three key assumptions underpinning the assertion that NAMA only requires a 10% rebound in property values in 10 years to ‘wash its face’. It looks at the importance of measuring the fall right, questions the yield given for NAMA’s loan book and raises the possibility of any yield correction coming through downward rent adjustment, not a rebound.
This post looks at the numbers behind NAMA in more detail, producing estimates of how much is in different segments of Irish and international property markets. It also critiques the calculation of long-term economic value, which turns out to be based on about 5% of the loan book, and presents revised estimates based on a broader sets of loans and more realistic assumptions.
This post sets out the key facts about NAMA, as per the Department of Finance’s supplementary information, published on Wednesday. It goes through the amount lent, the number of deals, the loan-to-value, the estimated fall from peak so far and NAMA’s proposed ‘plateau’ level, before raising some issues to be dealt with in later posts.
From one EP to another! Following Electric Picnic at the weekend, which featured Leviathan political and economic discussions as well as more food stalls and music acts than you can shake a stick at, today it was back to business and off to another type of EP altogether.
That was the Environmental Pillar, part of Ireland’s [...]
NAMA will purchase assets based on current market value and longer term economic value. This post discusses both of these frameworks, with particular emphasis on the importance of the yield chosen by NAMA as ‘normal’, and outlines the impact NAMA may have on property prices for the next generation or two.
