EASY MORTGAGES FOR FIRST-TIME BUYERS - The Government is planning to make it easier for first-time buyers to get a mortgage in an effort to kickstart house building. A portion of the mortgages to first-time buyers of new houses will be guaranteed by the State in order to allow banks give out more loans, reports the Irish Independent. The sharing of the risk will be undertaken through a government mortgage insurance scheme, paid for by the banks. This scheme will allow the first-time buyers to buy their houses with smaller deposits, by giving out mortgages worth up to 95% of the value of the home. A lower level of risk to the bank will also potentially lower the buyer's mortgage repayments. The increased level of mortgage funding is expected to provide certainty to the construction industry, allowing more homes to be built. It is part of a coalition plan to speed up the building of family homes and create 60,000 jobs in the construction sector. But the scheme will be tightly regulated to ensure it does not add to the property bubble of spiralling house prices. "The key has to be that the scheme has a greater impact on supply than on demand," a government source said. The plan will mimic similar schemes operated in Canada, Australia and Britain.
McATEER SETTLED €8.2m LOAN WITH ANGLO BEFORE LIQUIDATION - Willie McAteer, the former finance director of Anglo Irish Bank, settled an €8.2 million director’s loan with his former bank prior to it going into liquidation in 2013. Mr McAteer reached a settlement agreement with Anglo over a year ago, writes the Irish Times. The agreement was approved by its State-appointed board of directors, which had special rules in place to ensure former employees were not favourably treated relative to other borrowers. Mr McAteer agreed to sell assets, including his family home in Rathgar, Dublin 6, as well as shares and other investments in order to repay his former bank. He is also believed to have made a commitment to the bank to share in any income he may make in the future. This could include a share in any earnings he may make from High Court proceedings he initiated in March against Matheson, the law firm that advised Anglo on its dealings with the so-called Maple 10. Mr McAteer was found guilty last month of allowing Anglo make illegal loans to 10 developers known as the Maple 10 in order for them to buy shares in the bank. He was spared a jail sentence and Judge Martin Nolan said at his sentencing hearing that, among the mitigating factors he had considered, was that the banker was of the view and “given that view” that the Maple 10 lending had been given a “green light” by Anglo’s lawyers.
CONSOLIDATION AND CLUSTERS NEEDED TO BOOST SMEs - More consolidation and the establishment of sector-specific cluster groups are needed in order to strengthen Ireland’s SME industries, according to a new report. In its ‘How to be a Stand-Out SME’ report, the first comprehensive study, benchmarking Irish SMEs against their European counterparts, accountancy giant Mazars has suggested that in order to create a base of strong SMEs, with good balance sheets and reasonable scale, more joint venture agreements and merger/acquisition activity may be needed. The Irish Examiner reports that Joe Carr (global leader of SME advisory services at Mazars) said Irish SMEs compare favourably in terms of size with their counterparts in Britain, Germany, France, Spain and beyond, but lag performance-wise. He said things like a culture shift away from short-term financing, a change in attitude to risk, and improved management skills are needed.
LONDON LUXURY HOUSING MARKET 'COOLING', ESTATE AGENTS WARN - London’s luxury housing market has started to slow after several years of soaring price growth, estate agents warn. Savills, one of Britain’s biggest estate agencies dealing in prime property, said in a trading statement on Monday that it had seen “some cooling” in the top end of the central London market. The note of caution came a week after a London flat sold for £140m, making it the most expensive in the capital, and Grosvenor Group warned this month of a “bubble” in London housing, writes the Financial Times. The Duke of Westminster’s property company said it was pulling back from developing new homes as “the prospect of a correction is becoming more likely”. Savills estimated that prime central London house prices grew 8.9% in the year to March 2014 but will rise only 3-4% this year. “It’s a cooling in the rate of increase,” said Jeremy Helsby, chief executive. “The market has had a very strong run but we believe this year it will come off.” Mr Helsby stressed that London continued to be popular with the foreign buyers who have fuelled the price growth. “We’re still seeing increasing interest from Russian buyers, for example. As long as there is instability somewhere in the world, the London market will benefit,” he said.