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The Irish Independent reports
that it's the sort of "golden ticket" story that made property watchers
drool in the Celtic Tiger era.
A canny buyer purchases a house and quickly
"flips" it for a profit in the same time it takes the paint to dry on the walls.
One unidentified buyer managed to buck the trend
of plunging house prices by turning an impressive profit of €135,000 in the
space of just three months.
The property at salubrious Northumberland Road in
Ballsbridge, Dublin 4, sold at the largest ever Allsop Space property auction in
Dublin for €685,000.
The successful bidders were a couple in their 50s
who claimed it was on behalf of an unnamed buyer.
But, courtesy of the new property register, it
later emerged that the same property was purchased less than three months
earlier at the lower price of €550,000 through property agents Lisneys.
The house is described as a mid-terrace Georgian
building, currently vacant but has been divided into two small flats and seven
The seller will have to pay capital gains tax at
30pc of the profit as well as auction fees but will still register a significant
profit on the short-term investment.
It wasn't the only encouraging story for the
house market to emerge from yesterday's auction.
A two-bedroom terraced house in Dublin's Milltown
failed to sell for €150,000 at Allsop's last auction in July, but sold yesterday
Gary Murphy, director of Allsop, said there was
"an awful lot of cash" in the Irish market and there were people out there who
"don't need the banks" to be able to buy property.
Commenting on the future of ghost estates, Mr
Murphy said: "It all comes down to price -- anything can be sold if the price is
Allsop had hoped to raise €20m in the auction at
the Shelbourne Hotel in Dublin. In the end, it made €17.8m, with 110 properties
Among the 2,700 people in attendance were a large
number of estate agents, bank officials and investors keen to gauge the state of
Young buyer Doireann Hennebry (26) from Cork was
thrilled when she managed to net her first home, with partner Stephen Hicks,
having been disappointed at the last Allsop auction.
She came with her parents, fending off several
phone bids to buy the two bed red-brick house on Armstrong Street in Harold's
Cross, Dublin for €162,500 -- well over the reserve of €100,000 but a little
less than Ms Hennebry had thought she would have to pay.
"We're renting at the moment and that's more
expensive than the mortgage will be," she said.
The highest price achieved was €1.11m for a
mid-terrace Georgian office building with mews at Fitzwilliam Place and Leeson
Close in Dublin 2.
Among other properties sold were a three-bed
house in Tarmon Harbour in Co Roscommon which came with its own marina berth and
a retail and residential building in Dundalk. The lowest price achieved was
€22,000 for two tumbledown cottages in Shillelagh, Co Wicklow.
Property developer Hassan Ameer, who has been
living in Ireland for the past 20 years, bought a former convent in Roscrea, Co
Tipperary for €115,000.
It's a substantial building on 5.25 acres but Mr
Ameer admitted he did not come along to the auction intending to buy it and has
yet to view the property.
"The price was very attractive and I think it's a
good purchase. I think the rental income could be good but I'll have to see
first," he said.
Meanwhile, Catherine Lakes from Glasthule in
Dublin was the successful bidder on a cafe in the Beacon Court development in
Sandyford, paying €210,000. "I came with the intention of buying it for
€150,000. It went a little bit more," she said.
She used to run a laundrette, she said, but is
now looking forward to going into the coffee business and hopes it will fund her
An unidentified middle-aged man was the
successful bidder of four houses on Greenhills Road in Walkinstown, for
€560,000. He admitted afterwards that the lot had been "a little dearer than I'd
thought they'd be".
Publican Philip McBride came with the sole
purpose of buying the Poc Fada pub on Ross Inn Street in Kilkenny, emerging as
the successful bidder at €375,000. "Another winner for Kilkenny," he cheered.
He is the current tenant in the pub and said it
was a chip shop up to a few years ago.
"Like all pubs it's struggling but it's a good
old spot," he said, adding that it attracts a lot of stag and hen parties.
"I wouldn't have a good track record when it
comes to buying pubs," he confessed, explaining that he had previously bought a
pub seven years ago but shut it down the day he bought it to live in.
Meanwhile, rival estate agents, O'Keeffe Estates
of Sandymount in Dublin, indulged in a little tactical guerrilla marketing,
piggybacking on the auction by handing out their own flyers on the street
Independent also reports that the move by AIB to hike its mortgage rates by a
combined 1pc will mean the repayments gap between trackers and variables will
widen to €54,000 over the life of the loans.
The taxpayer bailed-out bank is hiking its variable rate by 0.5pc next month
after a similar rise last month, in a move that opposition politicians said
would push up arrears.
Repayments on a €200,000 variable rate mortgage will shoot up by €120 a month to
€1,222 in total.
But those on a typical tracker rate, set at 1pc over the European Central Bank
rate, will be repaying just €988 a month.
Over the full 20 years of the mortgage the variable rate customer will end up
repaying AIB €53,700 more than the tracker mortgage holder, calculations by
Fianna Fail's Michael McGrath show.
"It is neither fair nor reasonable to continue to increase the differential
between the tracker interest rate and the variable interest rate," the deputy
He added that the Government indicated some time ago that tracker mortgages
could be moved to the Irish Banking Resolution Corporation (IBRC) as part of the
overall restructuring of the Irish banking sector.
Such a move would improve the overall funding position of the banks and could
relieve some of the pressure from variable rate customers, Mr McGrath said.
AIB's standard variable and loan-to-value rates for residential mortgage holders
are going up by 0.5pc on November 13, along with buy-to-let rates.
Owner-occupiers will see their standard variable mortgage cost increase from
3.5pc to 4pc.
Around 70,000 homeowners are set to be impacted by the latest rise in the
The bank, which has been given €21.5bn from the State, said its variable rate
would still be the lowest in the market. Earlier this week AIB made a €1bn bond
repayment, despite having to be rescued by taxpayers.
The move by AIB comes after Bank of Ireland and ICS Building Society said their
variable rates are to increase by 0.5pc next month.
Mr McGrath said the rate rises by AIB, Bank of Ireland and ICS would push up
arrears levels. Around one in 10 of AIB's residential mortgage customers are in
The ECB meets again today but is not expected to cut rates on this occasion.
The Irish Times reports that a
secret recording of a meeting in Ukraine attended by Seán Quinn jnr, his cousin
Peter and some Ukrainians showed a “torrid row” about money and made clear the
Quinns cannot reverse a controversial US$500,000 payment over which Seán Quinn
jnr was jailed, his lawyer argued yesterday.
The US$500,000 payment was allegedly made to
Larissa Puga, general director of Quinn Properties Ukraine (QPU), and the video
made clear, whatever relations previously existed between the Quinns and Ms Puga,
they were “at daggers drawn” on January 21st, 2012, when the meeting was
recorded, Brian O’Moore SC said.
His client cannot be left to languish in jail
indefinitely over failure to reverse that and other alleged transactions
stripping assets from the Quinn family’s international property group, which he
could not reverse, counsel argued.
Even if the inability to reverse the transaction
was the result of his client’s own actions, which was denied, that could not be
a basis for keeping him in prison, he added.
The flaws in the jailing order were not
technical, counsel argued. The effect was Seán Quinn jnr unlawfully remained in
jail indefinitely until he purged his contempt by complying with 30 coercive
orders to reverse other asset-stripping transactions that involved no allegation
against him and that he simply could not reverse.
It was not permissible to jail his client for
failure to comply with 30 other orders when he was found in contempt on one
issue only – the Puga payment, counsel said.
Nor could he be jailed on the basis of a view he
was part of an overall strategy by his family to put multimillion assets beyond
the reach of the bank.
He was making submissions on the second day of
Seán Quinn jnr’s appeal against a High Court ruling that he was in contempt of
orders restraining asset-stripping on grounds he participated in the payment to
Ms Puga around late August 2011 just as QPU was about to be taken over by Irish
Bank Resolution Corporation, formerly Anglo Irish Bank, which claims to be owed
€2.8 billion by Quinn companies.
Mr O’Moore said the video recording of the
Ukrainian meeting made clear his client could not reverse the $500,000 payment
to Mr Puga. The Quinns owned just 15 per cent of QPU, with the rest owned by
their neighbours and relatives, he added.
It was clear the recording was by an unknown
person hostile to the Quinns, it was argued, and they objected to it being
viewed by the High Court on grounds it was only a 15-minute record of the
hour-long meeting in January 2012 and was not proven in evidence. However, the
DVD was admitted.
That objection was not being pursued in the
appeal as they could not “unscramble the omelette” and because the DVD supported
Seán Quinn jnr’s description of that meeting as “hostile”, counsel said. The
High Court erred in finding that his client participated in the payment to Ms
Puga as there was no evidence to support that finding, he argued.
The DVD, published by the Mail on Sunday last
July, showed the two Quinns arguing about money with Ms Puga and two
unidentified men, he said. The High Court had wrongly found the DVD did not
support his client’s claims of a collapse in relations with Ms Puga.
Seán Quinn jnr, detained in the Training Unit of
Mountjoy Prison since July 20th last, has been permitted to attend the appeal
and was in court yesterday with his wife Karen, brother-in-law Niall McPartland
and some supporters.
The appeal continues today until lunchtime, when
it is expected to be adjourned to resume at another date.
The Irish Times also reports
that senior executives from Spain’s second-biggest bank, BBVA, met National
Asset Management Agency officials yesterday as the Spanish authorities announced
further details of a “bad bank” to purge toxic loans from its lenders.
Spanish bankers and government officials have
been studying the Irish “bad bank” model as Madrid sets up a vehicle to acquire
toxic real-estate loans and repossessed properties from the banks.
These meetings are the latest in a recent series
of contacts between Ireland and Spain as the Madrid government uses a similar
mechanism to remove bad bank assets.
The setting-up of the bad bank follows last
week’s results of stress tests of 14 Spanish banks, which found that seven
require a further €59.3 billion for potential losses.
The bad bank and stress tests were conditions of
a €100 billion euro zone bailout request for the Spanish banks sought last June.
Spain’s economy minister minister Luis de Guindos
said yesterday that he wants banks, insurers and other investors to control 55
per cent of the bad bank.
Nationalised banks, including the country’s worst
lender, Bankia, will be the first to move assets into the bad bank starting in
December, said Mr de Guindos. The bank would acquire assets “at very
conservative prices,” he said.
“The transfer price is linked to the real
economic value of the assets and will be established through a thorough revision
of their quality,” said the minister.
The bank will mostly acquire property developers’
assets but other loans may be taken in if they deteriorate sufficiently, he
“Prices must take into account prices today and
in 15 years.”
Nama acquired loans with a book value of €74
billion at a discount of 57 per cent over a protracted valuation process.
The Irish Examiner reports
that a more deeply integrated single market would increase the EU’s GDP by 2% to
5%, the European Commission declared yesterday when launching a fast-track
programme to achieve this goal.
Although the single market, which abolished
borders for trade in the EU thus giving companies in each member state free
access to 500m consumers, is now 20 years old, it has failed to achieve its
potential as each country fights to protect its own market.
But with growth heading into negative territory and unemployment on the rise in
the midst of an economic crisis, Michel Barnier, the internal market
commissioner, believes now is the time to break down the remaining barriers.
He put forward 12 key actions for rapid adoption by the EU institutions,
concentrating on four main drivers of growth and employment:
* integrated transport networks;
* cross-border mobility of citizens and businesses;
* the digital economy; nactions that reinforce cohesion and consumer benefits.
"We think this agenda will be able to achieve more growth inside the single
market of between 2% and 4%. This is there for the taking," he said.
In financial terms this would amount to between €250 trillion and €500 trillion
The single market will be discussed by leaders at their next summit and while
the work would be legally very complex, it must be done, he claimed.
"We are wedded to success in this area as we do not feel there will be hostility
from member states if we get it right," Mr Barnier said.
For consumers, this means they should be able to choose from energy suppliers
across the EU, cutting their bills for instance.
While workers can take up jobs in other EU countries, it is still not easy
enough. The plan is to have a centralised database with more than 1m job offers
at any one time which citizens throughout the member states can access.
They plan new insolvency rules to create a second chance for entrepreneurs. "Our
national laws should not stigmatise entre-preneurs who try, and fail," said Mr
Ireland’s bankruptcy laws, for instance, disbar bankrupts for 12 years compared
to a year in the UK.
In the digital economy, he pointed out that sectors that account for only 6% of
trade in the EU make up a much higher percentage in the US and other parts of
"This is not normal so we want to create a real market for digital services,"
said Mr Barnier.
A third of internet users never purchase goods online mainly because they
believe the payment methods are not sufficiently secure. The plan proposes doing
something to increase security of online payments.
The issues of social cohesion and consumer confidence are essential for a
sustainable economy and rules dealing with product safety and transparency of
banking fees would also form part of this.
There will be a widespread debate on the proposals culminating in a Single
Market Week in October next year with hundreds of events throughout the EU to
make the ideas better known and collect reactions from all sectors of society.
The commission will put forward the legislation next year and hopes the European
Parliament and the Council representing the member states will adopt it by
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