AroundtheBlock: If you think house prices have taken a sudden leap since the beginning of the year, you're spot on, but only because estate agents are having to quote more realistic guide prices on property going for sale.
This week the Irish Auctioneers and Valuers Institute (IAVI) issued a no-nonsense instruction to agents, telling them that, from now on, guide prices are out and advised minimum values (AMVs) are in. It follows years of criticism of the system whereby agents deliberately pitched pre-auction guide prices on the low side to fill the auction rooms. While the practise was widespread, it wasn't helped by escalating house prices and buyers prepared to pay big premiums in the auction room for mid to upper-end houses. With the Government about to set up a new regulatory authority to police the estate agency business, the IAVI has moved quickly to bring some realism into the game with AMVs. Basically, agents handling auction properties can no longer advise clients of a property's real value, and then guide a lower figure to entice bidders. They must now reveal the AMV to both the client and to potential purchasers. It doesn't mean that people are not going to bid over that amount, but it will certainly take some of the froth out of the equation. Certainly, this week some agents were revising their former guide prices upwards in line with the diktat from Merrion Square.
Shane settles for way over the guide price
Sunday Independent columnist Shane Ross has been one of the sharpest critics of the absurd guide prices that have caused so much heartache among would-be buyers in recent years. The same gentleman came head-on with the issue recently when he paid a whopping €2.2 million over the guide price at auction for a swish Georgian house on two acres in Enniskerry village. Glenbrook, owned by top solicitor James Osborne, is a fine pile and nobody expected to get it at Colliers Jackson-Stops' guide of €4 million, particularly given its obvious development potential. Mr Ross, whose family comes from the area, was obviously happy to pay a knockout price of €6.2 million, beating leading UK nursing home company Barchester into second pace. Barchester is controlled by John Magnier, JP McManus and Dermot Desmond so Shane Ross is in very good company indeed. If the price seems high for a senator and part-time scribe, Mr Ross has other property interests and is a regular at Saturday viewings all over the city. He could hardly have been happy with the guide for Glenbrook, but not surprisingly he's been silent on this one so far.
Parlon's parlance on values needs practice
When it comes to guide prices, it seems the Government is just as inept as auctioneers in providing realistic information. Earlier this week, Minister of State Tom Parlon surprised many hardened property experts by claiming that the 20 acres at soon-to-be-vacated Mountjoy Jail could be worth up to €2 billion. His estimate that values could range from €10 million to €100 million an acre seems off the wall given that the best sites in the city, Jurys Doyle and the Vet College in Ballsbridge, made between €57 million and €84 million an acre. Perhaps the former farmer's leader knows something about Dublin 7 that has so far escaped the rest of us. The high valuation also seems to overlook the fact that several of the old jail buildings are to be listed, which always lessens the appeal for developers.
Paul and the Prince
Colourful Dublin estate agent Paul Newman has a new best friend, none other than HRH Prince Charles. The prince is keeping a close eye on Newman's latest venture - a pilot apartment and housing scheme in Northampton which is being built using a range of eco-friendly materials. Paul Newman New Homes has an £80 million (€116 million) contract for the present scheme which is sponsored by the Prince's Trust. It's one of a string of developments being built in the UK by Mr Newman who is rarely seen in Dublin these days.
Prince Charles was apparently greatly impressed by the use of sheep's wool as insulation in the attics of the homes being built. The wool doesn't come cheap - it's at least five times more expensive than conventional insulation - but only the best for Prince and Paul!
UL's property course
Limerick property investors look set to become a force to be reckoned with. Instead of surviving on gut instinct, like the old-school investor, many are going back to the classroom to learn the basics. The University of Limerick runs an eight-week course in property investment, entitled Location, location, location. UL says the course has been very successful to date but history doesn't relate if this success relates to the number of students it attracts or the bulging portfolios of its past pupils. The course costs €120. It starts on Valentine's Day and runs until April 4th.
Aimed at anyone looking to get on the property ladder, the course will tell you how to release equity from an existing property, the steps involved in overseas property acquisition and the opportunities in places such as the UK, Eastern Europe, France, Dubai, the US and China. Details from Mary Fitzgerald on 01-4321560.
