A State mortgage scheme for those who cannot get a home loan from the banks, and which has been criticised as sub-prime lending by the Government, is to be extended to second-hand homes. Originally, the Home Choice scheme only applied to new homes.
It will still only apply to first-time buyers, but they will no longer have to buy a new home.
Housing Minister Michael Finneran said the scheme was being changed to reflect the fact that most first-time buyers were buying second-hand houses. He insisted the change would have no implications for the Exchequer.
Under the Home Choice Loan scheme, the Government will lend up to 92pc of the value of a home to an individual buying a new house, provided they are a first-time buyer and earn in excess of €40,000 a year.
They must be in permanent employment for at least two years, and be able to prove that they have been unable to secure a sufficient mortgage from a bank or building society.
The loan will be at the commercial variable lending rate and the risk of each loan will be assessed using the same grounds that banks use.
However, there has been a poor take-up of the scheme. The minister said this week that half of all first-time buyers were buying second-hand houses.
Hopefully this might help sellers and buyers in what is a very stagnant market.
In a normal year (ie, one where there is availability of finance!) November and December are our quietest months, as the run-up to Christmas, shorter days and poor weather take its toll on the property-viewing public.
This year, October has seen the start of a rapid fall-off in activity, both against last month and last year.
Here they are:
October 2008 Viewings 97 Offers 44
October 2009 Viewings 41 Offers 19
As you can see, activity is less than half of last years.
Lack of mortgage availability is the main force at work.
Web figures for this month are interesting also:
Daft.ie/pfquirke: Visitors 7,043 Page Views 8,255
www.pfq.ie : Visitors 2,574 page Views 22,396
So a total of 30,651 virtual viewers, versus 31,939 last month, approx 4% lower.
The web figures, which have been similar all year, show that interest in property remains static.
However, all else has changed.
Instead of giving Seven Billion Euro’s to the Irish Banks who will squander the money on lavish parties and unearned bonuses, use the following plan.
You can call it the Republican Retirement Plan:
There are about 1 million people over 50 in the work force. Pay them 7 million Euro apiece severance for early retirement with the following stipulations:
1) They MUST retire. One million job openings – Unemployment fixed
2) They MUST buy a new car. One million cars ordered – Auto Industry fixed
3) They MUST either buy a house or pay off their mortgage – Housing Crisis fixed
4) They MUST send their kids to school/college/university – Crime rate fixed
5) They MUST buy 100 Euro of alcohol/tobacco a week …. and there’s your money back in duty/tax etc.
It can’t get any easier than that!
A query on Twitter prompted me to post an analysis of the web traffic for our properties.
@FirstPoint P asked if properties were being viewed online by prospective purchasers before they make an appointment for a physical viewing.
We post properties on daft.ie and www.pfq.ie ,which is our own site.
For the month of September, where we had 71 physical viewings, the following stats are revealing:
Daft.ie/pfquirke: Visitors 6,420 Page Views 7,238
www.pfq.ie: Visitors 2,663 Page Views 24,701
The higher page view ratio on our site is because it is targeted at Tipperary/Clonmel property buyers, so a visitor there is “on a mission”, rather than daft, where the majority of clicks are from Dublin based PC’s.
The most revealing figures summarising the current property market are that despite a total of 31,939 virtual viewings for the month of September, there were only 71 physical viewings.
Go figure!
Without wishing to sound negative... (note to self, be positive), September continued the downward slide for all in the Estate Agency business, when the figures are analysed.
House prices continue to fall. This has brought about a large number of enquiries from prospective purchasers, but they are slow to follow up on the enquiry with a viewing and consequently, an offer.
There are two reasons for this as I see it.
A lack of confidence is one.
A lack of available finance is the other.
As the banks wait, in zombie-mode, for the NAMA proposals to get past the Green party, no finance is being made available for house purchase.
Or any other purchase for that matter.
Why Lenihan and Cowen think that giving tax-payers money to the bozos that run the banks is beyond me.
Why they think that over-paying the banks for these toxic liabilities is a good idea is truly beyond belief.
Yet it seems that the fate of almost €60billion of our money hangs on a decision of a movement that does not really have a coherent policy on anything.
That said, if the Greens bring down this Government, I will give them my vote next time out...I may even consider joining the party if they can dethrone Cowen, Lenihan and Coughlan.
Protestations from the Govt. that “The pace of decline is slowing” (i.e. things are getting worse more slowly, but still getting worse) are meant to be good news!
Figures speak the truth and for our part, the figures this month show the continuing decline in activity in the market.
September 2008 Viewings 119 Offers 43
September 2009 Viewings 71 Offers 14
Remember September last year was a poor month anyway, as the economy had started to go into free-fall.
Even still viewings are down 40%.
Offers are down 68%.
Economists predict that levels of negative equity and inability to repay mortgages will increase over the near future, thus driving down the price of property further.
We need a new approach to our country’s regeneration. The current lot have shown no initiative or leadership.
In an effort to sound off on a positive note, they need to go...now!
Anything else will be better.
