Outbreak of common sense
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A report from the Irish Banking Federation today focusses, as we would expect, upon the serious business of making money, but it still manages to send an encouraging message to those whose main concern is the roof over their heads.
The bankers reassure us that "new lending continues to moderate in a mortgage market that is still growing in overall terms."
Translated, this means that people, mostly young people seeking their first home, are flocking to buy houses at prices they regard as realistic.
A sudden slump in construction, from 80,000 new houses a year to an expected 45,000 this year, with all its attendant job losses, could be rated as a hard landing.
Where prices are concerned, however, it appears that we may be seeing the beginning of an infectious outbreak of common sense, although it is still too soon to be certain.
First-time buyers have returned to the market, but this time they are buying sensibly within their means.
Those developers who are blessed with common sense are bringing down the prices of their existing properties to realistic levels, 10pc or 20pc less than a year ago. Most important of all perhaps, our financial institutions seem to have realised how irresponsible they were in fuelling the property frenzy with 100pc loans for all comers.
This may may be due to sudden intimations of mortality rather than common sense or concern for the common good.
Hard to believe that it is only two years since builders and estate agents were squabbling with the Economic and Social Research Institute over its warning that the property market posed a threat to the economy and should be cooled down.
Property values have now fallen to roughly the same proportion by which the ESRI had said they were overvalued. That is not the crash landing, complete with screaming passengers, predicted by some. The passengers are calm.
And if the drop in prices stabilises around the 20pc level, it will be a welcome soft landing. If prices continue to fall by, say 50pc, then the pessimists will have been proved right.
Hopefully, common sense on all sides will see us safe.
