So as I'm sure many of you are aware Ireland is in a little bit of trouble, thanks in part to the various dealings of it's banks who funded many property developments that went ka-blam.
Now I remember the early 2000's Cape Town was filled with talk of Irish money coming in and throwing up new developments all over the place.
The Cape Royale in Green Point for example was originally backed by some dodgy Irish Developer and was called The Clarendon, before the The Clarendon in London forced them to change their name.
I also suspect our favourite Sea Point development The Ballinrobe was funded by money from the Emerald Isle - Ballinrobe being an actual town in Ireland.
So collective brain, what other Cape Town developments were funded with Irish Euros.
5 comments:
Well hows this for a different contribution to Irelands woes?
SA is giving roughly 3.5 Billion Rand to the IMF to help bail out Europe, sorry bail out corrupt bankers behind the sovereign debts.
http://www.zerohedge.com/article/who-who-listing-countries-will-fund-imfs-bail-out-europe
Thus we get rid of some of those dollars we have been purchasing at a massive loss to try weaken our currency.
The greatest transfer of wealth of all time continues.
As titillating as fiscal Realpolitik is, can I be a party pooper by dragging us back to property values in Cape Town?
After the World Cup in July I found a glossy Seeff pamphlet flogging various "showcase" houses around the city. Hung onto it as a core sample. Makes interesting reading:
Constantia: was R3,5 million, now R2,95m.
http://www.seeff.com/buy/residential/details.php?pref=190870
Constantia: was R5.25m, now R4.89m
http://www.seeff.com/buy
/residential/details.php?pref=204372
Newlands: was R5.4m, now R4.99m
http://www.seeff.com/buy/residential/details.php?pref=201918
Wynberg: was R1.45m, now R1.2m
http://www.seeff.com/buy/residential/details.php?pref=197568
Gardens: was R7.6m, now R6.95m
http://www.seeff.com/buy/residential/details.php?pref=200487
Hout Bay: was R5.995m, now R4.95m
http://www.seeff.com/buy/residential/details.php?pref=204402
Hout Bay: was R4.35m, now R3.995m
http://www.seeff.com/buy/residential/details.php?pref=201947
Here's and interesting graph in Moneyweek on the UK housing market -
http://tinyurl.com/2dnk2v8
It compares house prices and new mortgage lending over the last 16 years.
A few interesting things to note - the 2 graphs pretty much follow each other over this 16 year period ... until now ... lending has nose dived yet houseprices blipped up and now there is a huge chasm between the 2 graphs ... and if house prices were to do what they have done in the past, according to the graph, then they must HALF (this is nominal).
Notice also that new lending peaked, came down a bit, blipped up again, then plummeted. A classic crash chart with the usual bull trap.
Now look at the house prices - theres the peak, there's the drop, there's the bull trap up ... and notice it is on the turn down. What's next ? It is all pointing to the same thing ... this is it, this is nose dive time for the UK crash.
Prices are about to half - they are following Ireland and the US.
Let house prices go down to real value. Real value is based on premise that average guy must be able to pay for an average house.
With that comes incredible pain and suffering of the middle class, most likely with 2 or 3 wars to get the attention away from the politicians.
All thanks to a policy of 40 years of cheap money in a debt based system where over 100 claims are being made on the same asset; they call it " financial innovation"...
Someone wrote an article in the Cape Times claiming the gold standard is not going to work.
Hah, tell you what: people will go on the street and demand a gold standard once they find out their pensions are gone and hyperinflation destroys their earnings.
Let the game of Musical Chairs begin.
before heading to Wall Street I was sent on assignment to Dublin (1997-2000). The Celtic Tiger was roaring and Dublin/Ireland was the place to be. Many "experts" predicted it would become the new financial HQ for Europe. I had my doubts and again saw too much speculation for my liking....including in their housing market.
I was put up in a 2 bed apartment in an upmarket area...rent €2500 p/m (in 1997 !!!) Property prices were way out of whack with local Dubliner salaries but the "Celtic tiger" was roaring and everyone would prosper. Developers built and locals stretched themselves. I can only imagine how speculation levels rose after I left...esp. between the crazy phase of 2003-2007
I have the same doubts and saw the same speculation here in Cape Town(2005-2008) as I did in Dublin in 1998.
Not only from a property perspective but economically in general.
The sub prime crisis hit the US late 07/beginning 08...almost 3 years later Ireland is getting hit..prob by Mar/April Spain will come under attack. I didn't expect there to be such a long lag in Europe after the US..my point is SA's time will come. If the Celtic tiger took a hit there is no way SA will be immune.
Post a Comment