Republican News · Thursday 4 April 2002

Houses just to live in

BY ROBBIE MacGABHANN

How many times have you seen a billboard announce 'If you see only one film this year'. Well, "If you only read one straight financial article this year, this week's Economist is a must for you".

"The houses that saved the world" is the cover story introducing the Economist's new global house-price index. The index has lots of striking features, particularly in how it relates to housing issues in Ireland.

The 26 Counties has, at over 80%, the highest percentage of households owning their own home. The state also registers the second highest real increase in house prices between 1980 and 2001. Only Spain is higher.

In terms of cities, Dublin has the highest real change in house prices, pushing past Madrid, New York and London. Also worth noting is that over the last five years, Dublin has registered average annual increases in house prices of 19%, meaning that in the lifetime of the present Fianna Fáil/Progressive Democrat government, house prices have doubled.

Dublin though, is not the most expensive city to live in and the average flat is only half the price for the same square footage in New York.

However, the most important feature of the index is easily overlooked. When it comes to taxing houses and speculators, Belgium imposes taxes and fees that can amount to 20% of the purchase price, creating an intolerable situation where property is viewed as "simply somewhere to live rather than as a speculative investment". This might be the reason, according to the Economist, why "property is much cheaper in Belgium".

Don't worry, we are dispatching special agent McCreevy to sort out these sick people and restore property to its rightful place on the right hand side of capital. And to think we let these people into the EU.

Smurfit's €10.1 million

Commiserations to Michael Smurfit; he took a 30% pay cut last year. Smurfit's basic wage, at €4.7 million, is still one of the highest salaries paid to an Irish worker. His €5.4 million in dividends propels him into the premier league of Irish earners.

Other Smurfit workers also got a good living wage. Chief operating officer Gary McGann received a 60% wage rise to €1.6 million, even though other Smurfit relatives suffered wage cuts. These included Alan, who will have to make do with €1 million and Dermot, who earned €922,000.

Shell's €3.5 billion Enterprise

"If anyone had doubts as to the value of Enterprise Oil and their Irish exploration interests they should be dispelled now," said Sinn Féin's Vincent Wood yesterday.

Wood was reacting to the announcement that Royal Dutch Shell was spending $5.7 billion to buy Enterprise Oil, including its 45% share in the Corrib field and other Irish resources.

Other competitors anxious to acquire Enterprise even though it has £800 million sterling in debts could up Shell's bid. "None of this really matters in Ireland as we won't benefit, having given away some of Enterprise's most prized assets for nothing," said Wood.