Is NAMA pulling our leg about the success of its deferred mortgage scheme?

“Early indications suggest the 80:20 Deferred Payment Initiative has been well received, with 16 units sold and reservations placed on another 16 of the 115 houses in the pilot phase. The value of these transactions generated in the two weeks since launch is €8.4 million” NAMA statement issued by Gordon MRM on 23rd May, 2012

It was 8th May 2012 when NAMA launched its long-awaited deferred mortgage initiative whereby NAMA will refund you up to 20% of the purchase price if the value of your purchase declines in the next five years. The scheme was announced almost a year exactly, previously and there were murmurs that NAMA was not handling the introduction of the scheme very competently. When the scheme was announced, so also were the details of the first 115 homes to which the new financing product would apply. A fortnight after the scheme was launched, NAMA issued a gushing press release in which it claimed it had sold 16 units and had taken deposits on an additional 16 – so 32 sales in the bag with a value of €8.4m in a fortnight. Great success – bualadh bos!

But fast forward four months and last weekend, the Property Price Register (PPR) was launched, and it would seem that to the 21st September 2012, just 13 sales worth just over €2m* have been registered in schemes in which NAMA had 115 units available. It should be said that errors have been identified in the PPR but on the face of it, NAMA wasn’t being straight with us when it issued its press release in May, and if there were 16-32 units in the bag in May, you would expect even more in September…

NAMA was asked for a comment on the apparent discrepancy, but has not responded at time of writing.

*4 units were offered in Carrickmines Manor and it seems there have been 11 sales to 21st September 2012 with an average sale price of about €150,000. As only 4 units were offered with the deferred mortgage product, four units at €150,000 are assumed to have taken place.

UPDATE: 7th October 2012. Although no explanation for the discrepancy is forthcoming this Sunday morning, a NAMA spokesperson says there is no question of overstatement of the position at any time

UPDATE: 28th November 2012. Almost incredibly, NAMA is claiming that it has to date sold 81 homes for an overall total of €15m (average €185,185). It is unclear if this is from just the 115 homes originally offered on the pilot scheme or if it includes the 180 additional homes offered in October 2012. This information was provided in a parliamentary question asked by Fine Gael’s Eoghan Murphy.

Deputy Eoghan Murphy asked the Minister for Finance the number of people that have taken up National Assets Management Agency’s 80:20 deferred payment initiative scheme.

Minister for Finance, Michael Noonan: NAMA advises that to date the sale of 81 houses with a combined value of over €15 million have been sold under the 80:20 Deferred Payment Initiative, which was launched on a pilot basis on 8th May in respect to 115 houses and extended on 15th October to an additional 180 houses.

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