One of the biggest mortgage lenders in Ireland has said the number of people who are in arrears for more than three months has continued to rise since the start of the year.
Irish Life & Permanent, which is loss-making, said there were signs the number of people starting to get into difficulties with their mortgage repayments was levelling off.
However people already in difficulty with their mortgages are getting into deeper water.
Around 4% of Permanent TSB’s mortgage book is in arrears.
It said salary cuts and joblessness is causing damage in the pensions’ market with premiums into corporate pension schemes down by almost one third.
Irish Life & Permanent is holding its annual general meeting later this morning.
Shareholders will hear updates on the company’s plans to shed its loss-making Permanent TSB brand, which is now damaging the wider group.
A survey by property website MyHome.ie indicates that two out of three intending first-time buyers say they plan to buy a property in the next year.
The survey also finds that 78% of first-time buyers now have the funds required to pay a deposit, which is up 20% from last September.
A similar number have either received or are seeking mortgage approval.
In his analysis of the results, independent economist Paul Murgatroyd, said first-time buyers clearly do not expect market and economic conditions to deteriorate significantly within the next 12 months.
Managing Director of MyHome.ie Angela Keegan said: ‘It is clear that Dublin will be the first market to see increased activity as 64% of first-time buyers wish to buy in the capital.
‘A further 13% are focused on purchasing in the traditional commuter counties of Meath, Wicklow and Kildare.’
However, in an opinion piece in today’s Irish Independent, economist David McWilliams argues that buying a house now makes no economic, financial or social sense, as he believes that houses are still substantially overvalued.
Property website Daft.ie says the asking prices for houses have fallen by 3.4% so far this year, which is the smallest quarterly fall in almost two years.
According to Daft, the national average asking price last month was €234,000, a total of €120,000 or 33% below the peak in 2007.
In Galway, prices fell by over 8% in the first three months of the year, while in Dublin, Wicklow, Waterford and Cork the falls were more in line with the average of 3.4%.
It now takes on average ten months to sell a house.
Price falls in early 2010 were largest in Dublin’s commuter counties, Galway city and north Co Dublin.
The report says that prices in Louth have seen some of the largest falls in the last three years, with the typical property now €200,000.
Daft says that while prices continue to fall and the total number of houses on the market is high, there is a steady decrease in the number of houses on the market.
All mortgage lenders have been banned from taking legal action against borrowers in arrears for one year after the householders have missed their first home loan repayments.
The lenders were written to by the Financial Regulator today informing them the new measures will come into effect from 17 February this year.
The measures now cover sub prime lenders, which had not been covered by a voluntary code of conduct.
In a statement, the Regulator said ‘the 12 month requirement does not apply where the borrower is deliberately not engaging with the lender.’
It added ‘The Financial Regulator is of the view that lenders should only seek repossession in less than 12 months in very exceptional circumstances and when all reasonable attempts to encourage engagement by the borrower have failed.’
Companies which fail to comply face the threat of fines of up to €5 million.
Homebuyers who lost deposits of up to €20,000 on apartments after a development company collapsed have asked the High Court to increase their refunds under a survival plan.
The High Court has heard the report from the examiner appointed to Laragan Developments on a scheme of arrangement for the company which is part of the Hanley Group.
The court was told the company has a deficit of up to €45m.
Lawyers for the examiner appointed to Laragan developments disclosed how the company has liabilities of €147m, the bulk of this is loans of €101m from its parent company the Hanly Group and Alan Hanly.
The examiner has asked the Hanly Group to step aside as the biggest creditor to allow a scheme of arrangement to be put in place.
The examiner proposes that those who lost deposits on properties in Santry and Carrickmines should receive only 1% back under a survival plan for the company.
However depositors have objected to the scheme and say they are being treated unfairly.
They want the High Court to change their status as creditors which could mean they receive 6% in refunds.
One depositor told the court to be offered a 1% refund was ‘an insult’.
Many said they had lost their savings and could no longer qualify for a mortgage. The case is ongoing.
Monthly statistics from the Central Bank show the first net fall in mortgage lending since 1990.The figures also show a sharp fall-off in credit card spending.
The figures for April from the Central Bank confirm the property market has slowed to a trickle.
It is the first time that repayments on existing mortgages has been greater that new mortgage lending since the Central Bank began this monthly statistics series in 1990.
The figures show that overall, mortgage lending fell by over €100m last month.
The amount of money loaned out in the rest of the economy also fell, reflecting concerns raised by many business groups about accessing credit.
People are also spending less on credit cards. The amount of money spent on credit cards by consumers in April fell by €180million compared to April of last year.
Apartment owners will have a greater say in the management of their complexes under new legislation published today by Minister for Justice Dermot Ahern.The Multi-Unit Developments Bill 2009 outlines legal protections that will affect over 500,000 apartment owners in new and existing complexes.
The Bill will set new standards for the operation of management companies and new rules for developers who build apartments.
Fine Gael welcomed the Bill, but said it was long-overdue.
Measures in the Bill include developers having to set up an ‘Owners Management Company’ prior to the sale of apartments.
The latest index from Permanent TSB and the ESRI has shown that house prices fell by almost 2% last month.This brings prices back to levels not seen since the summer months in 2004.
It means that prices nationally have fallen by almost 5% in the first four months of this year.
The average price paid for a house nationally in April 2009 was €248,640, compared with €261,573 in December and a peak of €311,078 in February 2007.
Houses in the first-time buyer category are falling at the fastest rate, down 7.9% already this year.
Niall O’Grady of Permanent TSB said: ‘This is the fastest rate of decline in national prices that we have seen to date since the index started in 1996.
‘The particularly dramatic reduction in prices for first-time buyers reflects their reluctance to buy in a market that is still declining and where unsold properties are being reduced further’
The Revenue Commissioners has begun writing to tens of thousands of homeowners whose mortgage interest relief has been stopped.
In the April Budget the tax relief was limited to homeowners in the first seven years of their loans.
Revenue is now asking 134,000 homeowners to clarify when their loans started to establish whether the relief still applies to them.
Before last month’s budget around 560,000 people qualified for mortgage interest relief.
Half of those receiving it had the relief stopped, of these 154,000 have been deemed ineligible.
Homeowners who are in this category are asked to take no action until Revenue contacts them.
Homeowners will be able to update details on www.revenue.ie or through their local tax office.
It has emerged that 57,000 people currently receiving mortgage interest relief will no longer be entitled to it from tomorrow.
Read the full Revenue statement
For more information from Revenue
According to the Revenue Commissioners, as of the end of last year, there were 562,000 people receiving mortgage interest relief.
However the entitlement is to be suspended from 1 May for everyone except first-time buyers.
The move follows the announcement by the Government in it is supplementary Budget to limit mortgage interest relief to seven years.
Last night Opposition parties in the Dáil accused the Government of creating confusion over the issue.
Under the new system the tax relief on monthly mortgage interest payments will only apply for the first seven years after someone buys a property for use as their home.
According to the Revenue Commissioners, the move means mortgage interest relief will be suspended for 321,000 of the 562,000 people currently receiving the entitlement.
Of those, Revenue says 57,000 people will definitely no longer be entitled to it.
It says it is in the process of working with mortgage lenders in establishing who is and who is not entitled to the relief.
Mortgage holders who have the relief suspended but are entitled to continue to receive it will have it reactivated in June, all arrears included.
220,000 first time buyers will not be affected by tomorrow’s move and will continue to receive the entitlement.
