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Archive for March, 2010

DNG report significantly improved sales activity at DNG National Conference held last Tuesday in Galway

Network offices of property company Douglas Newman Good Offices reported positive signs of recovery in the property market with an increase in sales and viewing levels across Ireland at its annual National Conference in the Carlton Shearwater Hotel in Ballinasloe, Co Galway. Attendees at the conference also reported that the rate of price decline has sharply decreased over the last quarter of 2009 and that the market appears to be very close to stabilisation. However this was after large price reductions were seen across all sectors of the market for the first three quarters of 2009.

DNG also noted positive signs in the property market with a large drop in the number of customers requesting the return of their booking deposits paid down to 5% from a high of 30% during the height of the property crisis.

According to Keith Lowe CEO, DNG Nationwide “This is very significant and our agency has not experienced a statistic like this since the boom years. Since the property market started to experience a re-alignment in late 2006 the number of buyers who paid our agency booking deposits on homes and then changed their buying decision was as high as 30%. This important statistic indicates that buyer confidence has improved and that prospective purchasers are not finding better value elsewhere in addition to not having problems arranging their mortgage. Many buyers are also advising us that they are keen to purchase now and take advantage of low long term fixed interest rates.”

It was also reported that property prices in the greater Dublin area have dropped by an average of 48% since peak in late 2006 but that the level of drop of 4% in the last quarter of 2009 was much less than the three previous quarters. According to the organisation this indicates that property prices in the greater Dublin area are close to stabilisation and the agency is predicting some level of price growth in certain areas of the market as early as next year if not before.

Attendees also heard that the number of new properties coming to the market for sale throughout the country has also reduced and that this reduced choice for buyers should also assist recovery of the property market.

The conference also reported that it is imperative that the government continue to ensure that there are sufficient levels of finance available through Irish financial institutions for property transactions as a vibrant property market is essential to assist economic recovery.

Keith Lowe also added “Following the very sharp countrywide price falls in property prices over the last three years it is encouraging to see much increased viewing and sales activity in the property market. Sales in our Dublin network have increased by over 30% this year compared to the same period in 2009. There is normally a time lag between market changes in Dublin and the rest of Ireland and it is encouraging to see evidence of improved activity already being experienced throughout the DNG nationwide network”

Speaking at the conference Shane Flanagan of DNG Flanagan Ford commented on the increased level of activity in the Sligo area. “Since December 2009 we have seen a notable increase in not only the quantity of viewings we have, but also the quality of viewings, ie the majority of viewers are genuinely interested in purchasing a property. We feel that prospective purchasers now recognise that there is excellent value to be had at present in Sligo & surrounding villages & towns. We have Sale Agreed numerous properties over the past few months & almost all of these sales are expected to conclude successfully.” Shane added “Some of the lending institutions are now lending funds especially to first time buyers & we have already seen the positive impact this is having on the local property market. Many sellers are now far more realistic about the price they wish their property to be placed on the market at & this has been a massive factor in attracting increased viewing numbers. This is a trend we expect to continue over the coming months.”

About Douglas Newman Good & DNG Nationwide.

Douglas Newman Good (DNG) are the largest seller of residential property in the greater Dublin area and operate a network of 67 real estate offices throughout the Ireland.

National Pensions Framework Summary

1. New Auto-Enrolment Scheme – to be introduced in 2014 – subject to economic conditions

• Employees (aged 22 or over) will be automatically enrolled once they enter employment or change employment unless they are a member of their employer’s scheme which must be:
– a DB scheme, or
– a DC scheme with a ‘ee contribution rate greater than or equal to the new scheme and an ‘er contribution rate greater than or equal to the new scheme
• Contributions to the new auto-enrolment scheme will be collected through the PRSI system via a central processing agency.
• Contributions to the new auto-enrolment scheme will be made within a band of earnings which has yet to be decided e.g. must be earning €350 per week and paying contributions on earnings up to €1,000 per week.
• Employees will be required to make a fixed percentage contribution of 4%. Contributions will qualify for PRSI and Health Levy relief.

• There will be matching State contribution of 2% and an employer contribution of 2%. The State contribution will equal 33% tax relief – the delivery mechanism for this has yet to be decided.
• A range of funds, including a low-risk default option, will be available. There will be no Government guarantees on investment returns.
• Employer contribution is mandatory.
• Employees can opt out but they will be re-enrolled every two years.
• Once an employee remains in the scheme for six months, their contribution will be held in a pension account and no withdrawals will be allowed.
• Once-off bonus payment for people who remain in the scheme for more than five years continuously.
• Intended that benefit withdrawals will be similar to PRSAs
• Small DC funds (probably €10,000 but exact figure yet to be agreed) may be transferred into the scheme – no matching contribution from the State or employer will be provided.

2. Current Pension Arrangements – implementation dates not agreed
• The State contribution will equal 33% tax relief – the delivery mechanism for this has yet to be decided. Tax relief on employer contributions and tax-free investment income to remain.
• Access to Approved Retirement Funds will be provided for defined contribution scheme members with effect from 2011.
• Specified income test to be increased from €12,700 to 1.5 times the State Pension (Contributory). AMRF option no longer to apply for new retirees. For existing retirees, the AMRF can become an ARF once the then specified income test is satisfied.
• Tax-free lump sum exceeding €200,000 to be taxed
• The range of personal pension vehicles available will be reviewed with a view to rationalising provision in this area.
• Regulations will be introduced to increase the transparency of pension charges;
• A revised and more secure defined benefit (DB) model is proposed which schemes may wish to consider if restructuring in the future.

3. Social Welfare Pensions
• Mandatory social welfare pension coverage will continue. The Government will seek to maintain the rate at 35% of average earnings.
• The system will be simplified with a move to a total contributions approach in 2020.
• Retirement age for State Pension age will increase to 66 in 2014 [(with the abolition of the State Pension (Transition)], 67 in 2021 and 68 in 2028.
• Arrangements will be put in place to allow people to postpone receipt of the State pension and to make up contribution shortfalls.

4. Public Service Pensions
• A single new pension scheme will be introduced for all new entrants, with effect from 2010.