Nama's free-market interference benefits only its balance sheet
Abolish upward-only rent reviews and allow market forces to find right price, argues James Fitzsimons
Published 11/09/2011 | 05:00
It's time for new leadership at Nama as it is interfering with the free market mechanism to make its own balance sheet look good.
Brendan McDonagh, the CEO of Nama, claims that commercial property prices might fall by 20 per cent if the plan to abolish upward-only rent reviews was fully implemented. Yes, Brendan -- did you ever consider that maybe that is what we need to get business moving again?
Speculation and reckless lending by the banks created the property bubble. And prices may have to fall even further before they can recover. When they hit the correct floor price, businesses might be able to buy the premises they need at affordable prices. Then the banks might even be willing to lend, and without unacceptable risk.