‘Servant to the Public’ and I have been engaged in a heated debate over the past few months, as to whether Dublin is currently experiencing a property bubble.
If this is indeed the case, it is particularly worrisome.
The dictum that those who cannot remember the past are destined to repeat it, doesn’t apply in this instance since no one in their right minds could possibly have forgotten about the recklessness and profligacy of the Celtic Tiger property bubble that brought about the country’s financial collapse and the loss of our economic sovereignty.
Could they? Could they?
Tragically, perhaps so.
In Dublin at the moment, we are engaging in a process of conscious collective amnesia.
We are so eager to see signs of recovery, of an end to the grind of austerity, that we are extremely vulnerable to the propaganda being disseminated by the Irish media.
And boy is there some propaganda at work.
Let’s remember that the Irish media has a vested interest in realising a resurgent property market. Most newspapers generated huge revenues from property advertising during the boom years, in fact the country’s leading property websites, myhome.ie and daft.ie, are owned by The Irish Times and Distilled Media’s thejournal.ie respectively.
So it’s no surprise to read headlines like this http://www.independent.ie/business/personal-finance/property-mortgages/surge-in-mortgage-lending-as-property-market-improves-30131196.html and this http://www.independent.ie/business/personal-finance/property-prices-rising-at-the-fastest-pace-in-seven-years-30130444.html.
But what is truly disconcerting is the level of deliberate obfuscation occurring.
For example, the last two consecutive months have seen a decline in the property market; however the media reported this as a year on year increase.
See what they did there?
And the government seem to be colluding with the media in this endeavour by taking no measures to increase supply of housing to the market to meet the level of demand, by preventing banks from undertaking necessary repossessions and by making no moves to force NAMA to release their residential property portfolios.
It all points to a government belief that property is what created wealth in the past, so it can do so again in the future. Ignoring the fact that only a few got wealthy and a whole lot of us are still counting the cost.
So the bubble, if it exists, is an artificial one, created by a historic lack of supply, pent up demand and fuelled by government policy and a complicit media.
The bigger question is how long will it be allowed to continue before it inevitably bursts and how many people will be sucked in before it does?