Fact: NAMA claims that it controls loans underpinning 10,000 houses and apartments in the Republic of Ireland. It told an Oireachtas hearing in September 2011 “We believe that we have 10,000 residential units in our portfolio. Fewer than 2,000 of these would be regarded as houses, whether detached or semi-detached. We have approximately 8,000 apartments.”
Fact: NAMA says that the value it placed on Irish residential related loans was a total of €3.69bn, comprising €2.31bn worth of housing inDublin and €1.38bn for outside Dublin. The NAMA valuation includes an average of 10% Long Term Economic Value premium.
Fact: NAMA says that residential prices had dropped 50% from peak to 30th November, 2009, the NAMA valuation date – you’ll need take my word for this claim as NAMA has now removed from its website the transcript of its chairman, Frank Daly’s speech to the Licensed Vintners Association in March 2011.
So, taking account of the above three facts, this means that the average value of a home in the Republic of Ireland acquired by NAMA was €332,100 in November 2009 – €3,690,000 less 10% Long Term Economic Value divided by 10,000 – and that represented 50% of a peak value of €664,200.
This doesn’t look realistic, particularly when you consider that NAMA says that 8,000 of the 10,000 “residential units” under its control are apartments. NAMA was asked for a comment on its claims but there has not yet been a response.
For quite some time, the position on here has been that NAMA does not have the dominant position in Ireland’s residential market widely accorded to it. There are 2m homes in Ireland, of which 290,000 are vacant, of which 60,000 are holiday homes leaving 230,000 non-holiday home vacancies. The National Institute for Regional and Spatial Analysis believes that the overhang of vacant homes in Ireland is 80-100,000. “Overhang” means an excess over the long term average vacancy. The Republic of Ireland’s vacant housing rate is 14.5%, which is twice that of Northern Ireland.
So 10,000 homes subject to NAMA’s loans is significant but out of an overhang of 80-100,000 it doesn’t give NAMA a dominant position, unlike the Irish commercial property market where NAMA control 15 times the size of the total market in 2011. However the figures above indicate NAMA has either control over relatively expensive housing or it controls more than it is letting on.
NAMA Wine Lake 
@NWL, An interesting blogpost with many unanswered questions, but once again pointing to unreported accumulated losses.
A query:
“Unlike the Irish commercial property market where NAMA control 15 times the size of the total market in 2011.”
Could you explain in more detail?
Many thanks.
@WSTT, NAMA says that it paid €9.25bn for Irish commercial property. That’s worth about €6-7bn today following 22% declines and stripping out long term economic value. I estimate the commercial property market to have been worth less than €0.5bn in 2011, of which Google’s two transactions accounted for half.
So NAMA controls loans on Irish commercial property assets worth up to €7bn and last year the market was worth less than €0.5bn, so NAMA controls c15 times the 2011 market.
@NWL, Thanks, NWL. The whole debt issue is becoming so bizarre it’s surreal. For instance to put the IMF’s statement that the EU banks will de-leverage by €2.6 trillion by the end of 2013 is farcical bordering on delusion. Again to put the suggestion into perspective:
Just One Trillion Seconds (never mind 2.6) = 31,688 Years, 269 Days, 1 Hour, 46 Minutes, 40 Seconds.
P.S. With reference to current average values on this section of the portfolio alone, it points to a further loss of €1.2 billion. (To put it into perspective – a million seconds is two weeks, a billion seconds is 32 years)
They can always Inflate away the old debt,by issuing new.That,may actually happen and work,voters have had enough austerity.
Excellent Articles in Sunday Papers with Interviews with two of NAMAs Top Debtors. Perhaps treasury and the like could learn a thing or two from these Guys
Missed these, which papers/debtors?
One Interview Concerned Donegal Man Mr Pat Doherty of Harecourt Developments,Where he seemed to Talk Freely about his working relationship with NAMA and then Yesterday an Article featuring Ballymore Properties Chairman,Surprised either of this did not get a mention on here as these two cases show what can be achieved by Debtors who actually Fully Engage with the NAMA programme with these two Debtors well on Course to Paying off Debts that they owed.
@Patrick,
The Pat Doherty interview is in the IT
http://www.irishtimes.com/newspaper/finance/2012/0504/1224315587055.html
There’s nothing there that hasn’t been reported here before as regards NAMA – the sale of the Wyndham hotel in Chelsea is covered here
https://namawinelake.wordpress.com/2012/03/05/luxury-london-hotel-associated-with-nama-put-on-the-market-for-e100m/
and the Harcourt agreement with NAMA was covered here
https://namawinelake.wordpress.com/2012/04/14/the-nama-top-30-developers-where-are-they-now/
The only quotation relating to NAMA in the entire piece is
“Nama has got a job to do,” says Doherty. “Everybody’s complaining about them; all they want is their money back. You have to work with them, be straight and open. They know we’ve been running our business successfully for over 30 years” and “Part of our arrangement with Nama was that we would sell a few things to reduce debt. That’s why we’re selling it [the Wyndham hotel]”
As regards Ballymore’s Sean Mulryan, he’s paid down some of his NAMA loans but still owes the guts of €1bn apparently
http://www.independent.ie/national-news/developer-to-pay-nama-123m-after-sales-rush-3101464.html
Ballymore was noted as one of the NAMA saved in the blogpost above.
Truth be told, there seemed to be very little that was new in relation to NAMA.
Just seems right that we also highlight that People are Successfully Working with NAMA and are Paying what they Owe in a Professional Manner. For all the Failures/Faults that we hear about them,People can Deal with them. Shows what can be done when People fully engage with the NAMA programme.
@Patrick, that’s fair enough though this blogpost did set out the reported Top 30 NAMA developers and how they are getting on with the Agency
https://namawinelake.wordpress.com/2012/04/14/the-nama-top-30-developers-where-are-they-now/
Not to mention the 2010 claim that NAMA controlled 6,000 apartments within the M50. https://namawinelake.wordpress.com/2010/09/24/%E2%80%9Cthere-is-quite-an-interesting-sustainable-one-bed-flat-market-and-we%E2%80%99ve-got-the-majority-of-it%E2%80%9D-nama-signals-a-strategy-of-renting-6000-flats-in-the-dublin-area/
So 10,000 units in total, of which 8,000 are apartments. And if 6,000 apartments are within the M50 then the masses of developments in the parts of Dublin outside the M50 and in other parts of the country only account for 2,000 apartments? Seems unlikely.
NWL.
Fred Was fairly busy doing speeches in early 2011.
A selection
1. Chartered Surveyors April 12
Click to access FrankDalySpeechToCharteredSurveyorsIreland12April2011.pdf
2. Cork Chamber of Commerce May 19
Click to access Speeches_Chairman_CEO_NAMA_19May2011.pdf
3. PR On Franks Speeches
Click to access NAMA_Speechs19May2011_BMcD_Cork_and_Dublin.pdf
4. British Irish Parliamentary Assembly June 11
Click to access NAMAChairmanAddressesBritishIrishParliamentaryAssembly14June2011.pdf
However the link to the Vintners speech has changed and is seemingly mistakenly indexed as a 2010 speech.
It is on the NAMA website here. ownload it in case it disappears on you again.
Click to access AddressByNAMAChairmanToVintnersAssociation22March2011.pdf
@2Pack, many thanks, they relaunched the NAMA website last year and it must have been mistakenly placed in the 2010 archive then.
I would ask NAMA straight out what they mean when they say ‘homes’. They may only count premises with electricity provisioned for example….while not counting premises where a switch needs flicking. So I would grind through their work in progress figures.
Also note that the small developers ( who all owe an average of nearly €19.5m each….down from €20m minimum over ayear ago…. and number 650 developers/speculators) may not be the most consistent and reliable reporters to the inhouse bank units that manage them for NAMA.
Even a figure of 300 small developers, in housing not commercial and owing €19.5m with 10 houses still on the books….gives one 3000 properties.
I left another copy of the Fred Daly Vintners speech here for you .
Click to access AddressByNAMAChairmanToVintnersAssociation22March2011.pdf
Keep up the good work.