Wednesday 11 December 2019

Local property agents are in period of recovery

Paul McNeive

Most of the attention in the propety market today is given to the big brand estate agents with multiple offices and staff numbers from 100 to 200 or so people.

But how are the smaller local agents surviving recession? With Allsop Space and online auctions, what is the outlook around the country?

I spoke with several top agents and it is fair to say that things are definitely looking up.

HJ Byrne have been trading in Bray, Co Wicklow since 1857 and principal John Doyle reports strong demand on the residential side of the business from first time buyers with rising prices and short supply.

Their team of seven also handle commercial property and Mr Doyle's biggest concern is over retailing in the town.

He says that HJ Byrne benefit from good relationships with large Dublin agents and he will soon be jointly selling with Savills a scheme of three shops and 34 apartments on Main Street.

In Wexford, Robert McCormack of REA McCormack Corish said that 80pc of instructions have been from banks selling off "buy to let" apartments.

However the number of instructions coming from private clients is increasing as prices rise.

Mr. McCormack said that being part of the Real Estate Alliance brand is crucial in bringing in multiple instructions from banks.

The banks give a large number of properties to one point of contact in Dublin and they pass the instructions to the local agent. He said the commercial market is weak but there has been several deals done on the Main Street this year including the likes of TK Maxx as well as Dealz/Poundland.

Murphy and Sons has been in business since 1959 and John and Walter Murphy lead a team of five, with offices in Sligo Town and also in Tubercurry.

The firm has been selling large numbers of "buy to let" apartments and Section 50 student accommodation on behalf of banks.

They are also sub-contracted work by Dublin firms. Walter Murphy told me that more "development land" is selling - some of which will revert to agricultural use. "Development land" which was making €1m per acre at the peak is selling at €60-€80,000 per acre."

In Athlone, Healy Hynes of REA Hynes said the firm has survived seven very tough years.

The firm has records going back decades and the numbers of transactions taking place in recent years was well below that achieved in the early seventies.

However Mr Hynes reports that the market is certainly now turning around. The company also benefits from work from receivers and has more staff than this time last year.

I found that towns with a tourism element are recovering quicker than others.

In Killarney David Culloty of REA Coyne and Culloty said the town has picked up considerably and that retail vacancy levels have fallen to as little as 5pc.

There is strong demand for hotels since the sale of The Aghadoe Heights nearby. David Culloty employed a new member of staff recently and says that business is improving, despite a lack of new supply.

Bobby Kerr at Newstalk is running a campaign to try and reverse the decline of Ireland's town centres, many of which have been badly affected by over development of shopping centres and retail parks.

I was pleased to contribute to the debate last weekend on the "Down to Business" programme and Ian Talbot, the Chief Executive of Chambers Ireland made some strong points.

Chambers Ireland are well qualified to speak on the subject as they have a network of Chambers of Commerce in every major town in the country.

Among other measures, Chambers Ireland are calling for targeted rates reductions in town centres, in order to help local businesses survive and prosper.

They are concerned that promised reductions in the Local Property Tax (eg Cork County Council have already voted to reduce the tax by 15pc) could come at a cost to commercial ratepayers.

They are encouraging local authorities to copy the Rates Rebate Scheme in Limerick which allows new businesses to claim a rebate of up to 50pc in their first year and 25pc in the second.

Ian Talbot says that the dramatic impact of out-of-town retail parks on town centres runs counter to the "Guidelines for Planning Authorities on Retail Planning." On planning policy generally, he is another voice saying that the "windfall tax" is blocking development.

Mr. Talbot gives the example of many single storey industrial buildings on large sites in the Naas Road area which are suitable for badly needed residential development but where no owner would reasonably release the land and pay CGT at 80pc.

I agree with him that the government must abolish this ridiculous tax in the next budget.

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