Stop These Men

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rory

From top: Brendan McDonagh (left) and Frank Daly, CEO and Chairman of the National Assets Management Agency (NAMA) respectively; Dr Rory Hearne

NAMA is worsening our housing crisis by selling  housing and land to vulture funds.

Dr Rory Hearne writes:

So the rich are just getting richer in Ireland while the poor remain poor. But the wealth at the top in Ireland is really staggering.

The latest Sunday Times Rich list shows that Ireland’s 250 richest people now hold €72.6bn. Their combined wealth is equivalent to a third of Ireland’s GDP. The top 12 individuals have a combined wealth of €34bn.Their wealth rose by 3.3% in the last year (€1.8bn).

Why this matters is because lower income and middle classes are getting a smaller slice of the pie as increasingly the wealth being created in society is going to the top. The result of this unequal distribution of wealth is our huge rates of poverty.

There are now 138,000 children living in poverty in this country. There are 912 families with 1,881 homeless children. Surely it is time to ensure a more equal distribution of wealth that would involve an increase in tax on the top wealthy in order to pay for housing for our homeless or higher welfare for our poorest families to lift them out of poverty?

Another area where wealth is being accumulated by the already super rich on the backs of ordinary Irish people is through buying up and selling on property from NAMA.

The vulture funds such as Goldman Sachs and Lone Star are lining up to buy NAMA property and loans.

NAMA is selling two portfolios of loans and assets which have a combined value of €4.7 billion.

These include, according to the Irish Times, 950 residential properties, mainly apartments, 650 of which are occupied by tenants and a further 300 vacant.

So hang on a minute! Yes, you read that right. NAMA is currently selling 950 apartments to the vulture funds. And what’s worse 300 of them are vacant.

Surely the government should stop NAMA selling these off or Compulsory Purchase them in order to use them instead to address our homeless crisis? The 300 vacant properties could be immediately used to address the crisis for 300 families.

There is a need for a spotlight to be put on NAMA and how it is currently worsening our housing crisis by selling much needed housing and land to vulture funds.

Remember we own NAMA! It is a state owned body. So there is no reason why we can’t direct NAMA to use its housing and land to address our housing crisis.

We are again giving away our assets, just like we gave away our gas and our fisheries to international corporates.

What is it about us? Do we want to be a permanent colony of international finance?

Do we have something in us that has no confidence in our own capacity and capability to provide for our citizens?

We have got to the point of dependence on international investment that we can’t do the most basic things ourselves like use our assets (land and housing) held by NAMA to house our people who need homes?

The vulture funds buying up our housing, property and land have been more active in developing countries for a number of decades. If you are interested in finding out more about the dangers and problems associated with vulture funds there is a public talk being held on the topic by the Debt and Development Coalition on Wednesday next week.

Mick Byrne, will present the findings of a new Report that looks at the risks posed by vulture funds in Ireland, the experience of the Global South and the role that is being played by the Irish Government.

Tony Romano of the US housing rights organisation Right to the City will also be there to talk about how tenants in the US have been affected by the vulture funds who have bought their buildings. Details here

Dr Rory Hearne is a policy analyst, academc, social justice campaigner. He writes here in a personal capacity. Follow Rory on Twitter: @roryhearne

Related: Julien Mercille: Swoop Of The Vulture

Meanwhile…

39 thoughts on “Stop These Men

  1. fluffybiscuits

    Vulture funds are also driving up house prices. The question is (and based on my understanding so apologies if I am wrong). NAMA is selling housing at knockdown value and this is allowing vulture funds to sell them on at a profit? Id be interested to see the cost of keeping those houses on the books and using them to solve the general housing crisis vis a vis the cost of selling them at low cost to vulture funds. Steadying the supply to a drip drop affect keeps the housing prices up.

    1. ahjayzis

      Well, they say social housing pays for itself after 20 years. Seeing as these are already built, and were acquired by NAMA for a haircut…

      1. Rob_G

        Really? I’m not saying its a bad idea to use them for social housing, but ‘pay for itself in 20 years’ things sounds too neat (what if it is the state that is paying for the housing?)

        1. ahjayzis

          People do pay a differential rent based on income, Rob. It’s not an entirely free thing and not everyone who needs a social house is flat-out broke. Remember that for everyone on the list in private accommodation the state is paying full rent to that landlord.

          That figure’s admittedly a UK figure though.

          1. Rob_G

            I realise that ( also, that the benefits are not purely monetary); curious, do you have a link for where you read this?

  2. Harry Molloy

    Whatever about the rights and wrongs of NAMAs sales, I think it’s worth stating that vultures funds aren’t some type of shadowy clubs owned by maniacs and Rothschilds.
    They are simply normal funds companies whose mission statement is to get the best return on investment. If you have a pension you’re probably in one. If you have insurance you’re probably involved with one.

    They can invest in anything, even buying out the likes of Burger King before selling on.

    it’s not something new or shady.

    1. ethereal

      the issue isn’t really with the vulture funds, it’s with NAMA selling to them. I just don’t understand how these properties can’t be put out onto the market for the public to buy

      1. ahjayzis

        They’re selling mortgages at a discount – but don’t allow the mortgage holders to bid on their own property. Literally shovelling money at international banks.

        1. Serf

          Yeah and the reason they won’t allow mortgage holders bid on their own property is to prevent allegations of cosy deals, so they’re damned if they do…So long as they sell on the loans at a fair market level and don’t stall the process, I’ve no problem with it. Holding on to a mish mash or mortgages and development land with a view to becoming an accidental landlord is a recipe for disaster.
          If the State wants to acquire housing stock it should go into the market and bid for it (from NAMA or whoever else is selling).

          don’t stall

      2. Rob_G

        I imagine that the admin cost of individually selling the thousands of properties that NAMA owns would be prohibitive.

      1. Harry Molloy

        They aren’t shady, they are what they are and it is obvious and visible what they do.
        It’s whether they are allowed to do so which is a matter for the national legislature

      2. rotide

        If anything is shady it’s the continuous use of the word ‘Vulture Fund’ to conjure up a certain image.

        Dr Rory needs to brush up on his writing by called Goldman Sachs a ‘vulture fund’. They are a bank who operate many funds.

        1. Anne

          They’re vultures in that they specialise in buying distressed loans ..people in arrears basically. Like vultures they swoop in when the pry is at it’s weakest.

          They’ll have no problem fupping these people out on the streets, as long as they maximise their return. Irish banks won’t want to be seen to be doing this.. We can blame the vultures when they’re fupping people out of their homes..selling on their asset, rather than the Irish own banks.

    2. jack johnson

      Oh, the poor misunderstood vulture funds, their benignity must be lost on those pushing to prevent those same funds from using European courts to extract loan repayments from indebted countries – where a government receives debt relief – and then sue for the full amount plus ridiculous interest, taking money that should be used to fund hospitals, schools, housing, food programmes etc.
      The UK has led the way and has already banned this practice.
      You really are nailing your colours if you think there is nothing shady about them.

  3. Murtles

    If only we had a Government with the balls to do something constructive about homelessness.
    If only we had a Government with the balls to do something
    If only we had a Government with balls
    If only we had a Government
    If only

    1. Rob_G

      Provision of social housing is within the remit of local govt – so, bring it up with your county council.

    2. Kieran NYC

      If only the people who made political hay from homelessness actually wanted to go into government.

  4. Cian

    “So hang on a minute! Yes, you read that right. NAMA is currently selling 950 apartments to the vulture funds. And what’s worse 300 of them are vacant.”
    Do you think that the ‘vulture funds’ are going to move these 950 apartments out of the country in the middle of the night?
    Maybe, just maybe, they will rent out the 300 vacant ones – which will mean there is more housing stock available!

    1. Kolmo

      More housing stock at artificially inflated prices – because they are “market creators” – Lloyd Blankfein Goldman-Sachs, while under senate investigation for “creating” a market of sh*tty-deals….

  5. jake38

    I’m stunned it took 21 counts for people with a university degree to see through Commisar Rory’s Trotskyite bilge.

      1. Andy

        Not all university degrees are equal…..

        Don’t worry though, Rory is an activist. He’ll have more time to eh.. activate now he isn’t the seanad.

        Vive le revolution (but not on Ford Super Sunday’s)

    1. Anne

      What part of this is bilge exactly?

      “The latest Sunday Times Rich list shows that Ireland’s 250 richest people now hold €72.6bn. Their combined wealth is equivalent to a third of Ireland’s GDP. The top 12 individuals have a combined wealth of €34bn.Their wealth rose by 3.3% in the last year (€1.8bn).

      Why this matters is because lower income and middle classes are getting a smaller slice of the pie as increasingly the wealth being created in society is going to the top. The result of this unequal distribution of wealth is our huge rates of poverty.”

      Would that be none of it?

    1. molly

      In Norway & Holland this would not be allowed as they recycle their social housing. They do not sell them on the government retains them so they will always have a supply of housing for those who need it.

  6. Anne

    Surely it is time to ensure a more equal distribution of wealth that would involve an increase in tax on the top wealthy in order to pay for housing for our homeless or higher welfare for our poorest families to lift them out of poverty?

    http://www.davy.ie/binaries/content/assets/davypublic/fund-services/briefings/ireland-as-a-domicile-for-european-property-funds-web.pdf

    Increase in tax? How about any tax..

    ‘How are a QIF and its investors taxed?
    Irish regulated funds, including QIFs, are exempt from Irish tax on
    their income and gains. Therefore, any rental income or capital
    gains derived from real estate or real estate related assets will not be subject to tax in Ireland’

  7. Anne

    http://www.matheson.com/images/uploads/publications/Establishing_a_Qualifying_Investor_AIF_in_Ireland_WEB_Jan_14.pdf

    2.5 The ICAV
    A new corporate fund structure is expected to launch in early 2014, called the ICAV. The ICAV will sit alongside the public limited company (“plc”) structure, which has been the most successful and popular of the existing Irish fund structures to date. The new structure will represent a modernising of the existing corporate fund structure and is designed specifically with the needs of investment funds in mind. The ICAV is expected to be incorporated with the Central Bank (although this has yet to be confirmed) and will provide a tailor-made fund vehicle which will be available as a corporate structure to both UCITS and AIFs. One of the primary advantages of the ICAV will be to provide for a corporate entity that can elect its classification under the US check-the-box taxation rules.

    5.1 Taxation of Funds
    Irish domiciled funds are exempt from Irish tax on income and gains derived from their investment portfolios and are not subject to any Irish tax on
    their net asset value. Irish residents may invest in an Irish domiciled fund without affecting the tax-exempt nature of the fund.

  8. AN Other

    Just a minor quibble on an otherwise excellent piece.

    IIRC, NAMA is 51% owned by a Special Purpose Vehicle which in turn is split 33.33% between
    AIB, BOI & PTSB.

    The taxpayer [via the Minister for Finance] owns the remaining 49%.

    All a scam – private shareholdership majority ownership of the biggest property company in the world.

    Which is backstopped by your taxes.

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