We are safe from a crash, but not from landlords
The Central Bank's new mortgage-lending rules have become a renting story, instead of a buying story.
Lots of people will be shut out from buying houses for quite some time to come. It also means Ireland's chances of having another property bubble are greatly reduced.
With so many now consigned to renting for longer, this sector's problems look like getting worse, particularly in Dublin. A recent survey of property professionals around the country showed that the West, North West and Border regions were the only ones where participants expected a surplus of properties available to rent would remain.
Everywhere else they expect demand to overtake supply by the end of this year. House prices in Dublin are 38pc below their 2007 peak. Rents in the capital are less than 10pc below peak.
Around 320,000 households are now rented, accounting for 20pc of the national total. This is up from 195,000 in 2006.
It could become bonanza time for property investors. But, if you want to jump in and get a slice of this action, you better have quite a lot of money saved yourself.
Under Central Bank rules you can only borrow 70pc of the price of a buy-to-let property. With 25pc of buy-to-let loans gone delinquent in some shape or form, a lot of landlords are stuck with properties they have, or ones they are about to lose.
Nearly three-quarters of landlords in Ireland are classified as amateurs because they own no more than two properties. I suspect the Central Bank would like to see some of the amateurs replaced by large professional companies specialising in the sector.
Those guys are arriving in the market every week, buying up apartments in places like Sandyford and Tallaght. If the Government really wants to fix the housing market, it will have to protect young couples forced into longer-term renting by the property wolves.
This means having a properly functioning sustainable rental sector. Right now the State is picking up half the tab of all money paid to private landlords in Ireland, through rent supplement and other schemes. The bill is over half-a-billion euro a year.
The new rules provide some reprieve for first-time buyers who can borrow 90pc of the first €220,000 to buy a house. This will definitely provide some help, but it will still reduce the amount of money first-time buyers can borrow to purchase. This, in turn, will act as a drag on house prices.
If anyone is going to have a clear run in the property market it will be the large corporate buyer with deep pockets. They will have a chance to purchase thousands of rented properties put on the market by bust landlords.
Once acquired, they will be able to charge very high rents to punters forced into renting. They can get tax relief on three-quarters of the interest they pay on loans they took out to buy the property.
Central Bank governor Patrick Honohan may have saved us from the next crash - but it is up to the Government to save us from excessive rents.
Investor took big bite out of Apple
Two years ago this very week I wrote an article about the collapse in Apple's share price. The stock had fallen by over 35pc in the previous six months and the company shed around $195bn in value.
Commentators all agreed that competitors were nipping at Apple's heels with quality, cheaper smartphones; chief executive Tim Cook had yet to prove himself; the company was carrying a massive valuation and Apple needed to deliver some killer new products.
I was talking to a very shrewd investor a few days after I wrote the article. Sitting in the corner of a Dublin restaurant, he told me how he had bought and sold Apple shares on and off for around two decades.
In total he had made about $80m in profit on his Apple share buying and that he was buying that week when the stock was crashing. He said he believed in Apple's ability to command a premium price for quality products and in the inventiveness of its team of people to come up with new ones. He said he felt Apple still had a long way to go as a company.
Last week, he was proven right and I was proven wrong. Apple reported a record $18bn profit for the last three months of 2014. At $114 per share, the stock is hovering around a record high.
I worked out that if the investor (who will remain anonymous) was buying two years ago, when others were selling, he would have been buying at around $65 per share. Apple shares hit the bottom in April 2013 at $55. Based on a reasonable average purchase price from the period my investor friend is up 76pc.
That is why he is worth millions and I am not.
Apple is sitting on $178bn in cash and has debts of just $35bn. In theory at least, it could buy 480 of the S&P 500 companies.
Its shares are trading at a multiple of under 15 times earnings and brokers have been revising upward their price targets for the group.
This followed quarterly figures showing it sold 74.5m iPhones in the last three months of 2014, with a 70pc lift in sales in China. Perhaps Bono didn't do Apple any harm after all?
With a cash pile of $178bn, the $70m Apple supposedly paid U2 for their album looks like chicken feed. As does the $3bn it paid rapper Dr Dre for the Beats audio brand.
It is preparing to launch its Watch (no, not iWatch) in April and appears to have lots of other ideas in the pipeline. There is speculation that it will now increase its share buyback and dividend programme to give more money back to shareholders. This could even hit $200bn over three years.
Apple's biggest problem is that it has so much money that it has to figure out what is the best thing to do with it. It's a bit like my investor friend that way.
Why Michael O'Leary needs Joan Burton to say 'Yes'
Few could be more delighted with the IAG bid for Aer Lingus than Ryanair chief executive Michael O'Leary. His airline is just days away from a UK court ruling that is likely to tell Ryanair to sell its Aer Lingus shares.
A year ago Aer Lingus was trading at €1.40, valuing Ryanair's stake at €216m. The company paid around €400m to acquire it.
With an offer price of €2.55 on the table from IAG, Ryanair can get out of the Aer Lingus situation with virtually all of its money back.
Plus, Aer Lingus is not being bought by a low-cost operator that might try and take on Ryanair.
But then along comes the Labour Party. TDs are questioning whether to reject the offer because of the possible threat to jobs, Heathrow slots and regional access to Cork and Shannon.
If Joan Burton and her Labour colleagues reject the offer, the Aer Lingus share price could fall back close to the €1.40 mark - or even lower - because it means nobody can take it over.
Ryanair might only get closer to €1 per share if it were to become a forced seller. This would bring in €154m instead of the €387m now on the table.
Joan could yet cost Ryanair around €230m.
Sunday Indo Business