Ronan Lyons on NAMA and Property Prices

Following up on his earlier work, Ronan has an interesting article in today’s Irish Times. Link here.

21 replies on “Ronan Lyons on NAMA and Property Prices”

Is this the same Ronan Lyons who told us in August 2007, a full year after the bubble had popped, that:

“With such strong rental growth for the first half it is difficult to see any problems occuring in the rental market for the forseeable future.”


“Therefore, static house prices are to be expected and, given rates of inflation generally, falls in real house prices are on the cards for 2007 and possibly 2008. In the long run, though, this is perfectly normal behaviour, as the market looks to correct the yield.”

Doesn’t exactly inspire confidence in Mr. Lyons.

By own best estimate is that we will be down 60% to 65% in the next few months meaning we would need a approximately a 70% to break even.

When we get more details it would be great to factor in the operating and funding costs of NAMA. This could mean we need even larger increases just to break even.

You are playing the man not the ball Donal.
BTW afaik rental problems in the commercial market have only manifested themselves this year.

The one and the same! Happy to admit I was wrong back in 2007. I was looking at the same long term measure of health then as now, i.e. yield. The information I had available to me at the time (rents rising at 15% a year, static house prices) led me to believe that yields would correct through rising rents, not falling house prices, i.e. what turns out to have been an overly optimistic assessment.

In essence, I’m asking here that the Minister doesn’t make the same mistake.

Fast-forward to the last two words of final para: ‘ … fundamentally flawed.’ Nuff said!

@zhou – problems in the commercial market? Spot on! Negative equity in the domestic sector is simmering nicely and should be ready to boil over next year.

How about a ‘fast-track’ personal bankruptcy process: three years and your out. Consumers inability to clear their debts will crush our economy; its 60% dependent on consumer spending! You’d think someone in charge would notice. Too busy stuffing their pensions I suppose.

Brian P

NAMA is great – and the good news is – there’s one apartment for everybody in the audience !!

Nama is interesting – but can anybody answer how the over 2-3000 people who have under 5 million in debts, there suppliers and subcontractors are going to be dealt with – these people will never be paid !

We haven’t heard much about the 10 bn that NAMA requires to ‘complete in progress developments’ lately, have we…

@ Donal says

“Is this the same Ronan Lyons who told us in August 2007, a full year after the bubble had popped, that:

“With such strong rental growth for the first half it is difficult to see any problems occuring in the rental market for the forseeable future.”

He was right if you take the “forseeable future” as being a time frame of approximately one year. Top rents were still being achieved up to August 2008.

Furthermore, when the facts changed, his analysis changed. Unlike the government, who’s response to changing facts, is to tell those of us that analyze them, that we are being unpatriotic.

I am more and more convinced that NAMA is a philosophy and not a rational, logical response to economic problems. Hence, the blind adherence to the philosophy called NAMA. Consequently, maybe the government would be more amenable to theological arguments. The dictionary defines “theology” as the study of God, nature and religious beliefs.

Despair Alert
Excellent work from Ronan, putting figures on what many of us (reasonably accurately) speculated on. Great work Karl on the “hat we still dont know about NAMA”.
If Jesus, Jimmy Hendrix and Allah appeared in the cabinet room, reiterated the analyses and figures, NAMA would still go through, I feel.
Its much more likely that if as appears Roddy Molloy is the Harry Whelehan of the government, that will stall/derail NAMA. No analyses, no calculations, just events….


Ronan came out at 44 as against 51.3, the 46 came out with 30 as against 60.
“reasonably accurately”?

A bit long winded.

But the essential point is that Gormley et al may not get the two thirds majority they need for their “new” programme for government, even if they get NAMA.

General election by mid November?

“The plus side for the embedded ones is that even if a majority of their delegates vote against Nama, so long as the Nos fail to get two-thirds of the vote they can still technically stay in government.

However, the converse side of this is that if the party’s TDs fail to secure the support of two-thirds of their members for the renegotiated programme for government they will have to walk.”

@Brian Lucey

Nil Desperandum.

The 46 have done their patriotic duty.

You have raised the level of the debate above the ordinary and I thank you for that.

It now only remains for the GP delegates to do the right thing.

I do feel that many of those delegates are very well disposed to the arguments advanced on this blog, and that they will put Nation before Party on Oct. 10th.

This truly is their date with destiny.

@ Blake

The money quote.

“Ireland, like other countries, has to get over the notion that creditors are a sacred group who must be spared at all costs.

At the very least, the government shouldn’t ask taxpayers to wager so much on the hope that things will stop getting worse.”

@Blake – thnks for the link

Good one – the title sums it up neatly:

“Bank Bailout Reject Embraced by Declawed Tiger”


“The real-estate industry prognosis is bleak. “There is still no evidence of a recovery in the housing market — either in building activity or demand,” analysts at BNP Paribas wrote in a report earlier this week. “Residential property prices will likely fall for the foreseeable future.”

How frustrating is it that they can persist in the “Big Lie” about property LTEV? despite the evidence. They have to be stopped before they destroy us.

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