Wednesday 21 February 2018

Vast bulk of Nama home sales are to families, not investors

House prices are expected to rise this year (stock photo)
House prices are expected to rise this year (stock photo)

Paul Melia and Michael Cogley

Private buyers seeking a new home bought almost 90pc of properties that were sold by Nama last year.

The State's bad bank said that, of the 5,345 houses and apartments sold directly or by receivers acting on its behalf, almost 4,800 were to individual purchasers.

The agency has been sharply criticised for selling portfolios of residential properties to cash-rich investors and so-called vulture funds over recent years. These investors are keen to purchase as house prices continue to rise due to a shortage of homes coming on stream.

A new forecast from Merrion Stockbrokers says that prices will rise by an average of 5pc this year, following increases of 10.6pc last year and 12.9pc in 2014.

The house price forecast comes despite an 8.5pc drop in the number of approved mortgages for the 12 months ending in February.

This follows the introduction of tough Central Bank lending rules. The mortgage trend doesn't take into account buyers paying in cash.

Nama said that most sales of residential property last year were to individuals, and not investors. Some 89pc of all sales - or 4,783 - were to individual purchasers.

The remaining 11pc, totalling 562 units, were portfolio sales. All had sitting tenants and were purchased by investors.

The agency is required to make the best commercial return on behalf of the State, and expects to achieve a surplus of €2bn when it winds down its operations.

Nama intends to fund 20,000 new homes, mostly in Dublin and other areas of high demand including Galway and Cork, between now and 2020, with most targeted at first-time buyers.

Irish Independent

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