Buy property in Ireland at fire-sale prices

Atlantic waves roar and crash onto sandy beaches while on the other side of high dunes ancient dry-stone walls mark out a patchwork of green fields and country lanes. Amid this landscape of sea cliffs, enchanted islands and craggy mountains you can enjoy long summer evenings filled with the warm aroma of cut grass and honeysuckle.

You can swim with dolphins or compete with them for the ocean’s rich bounty from rocks or boat. At night, the pubs fill with characters…fishermen, fiddle players, vacationers and more—everyone ready to share a story or a song over a pint of Guinness.

This is Ireland. And today you can buy real estate here at a discount of 80% on peak prices. You can buy that dream cottage by the sea, the pub on the village green or your country house surrounded by horses, all for cents on the euro.

Today’s deals aren’t just to be found along Ireland’s dramatic Atlantic coast. On the leafy boulevards of the capital, Dublin, there are deals. Here, you’ll find terraces of large, historic Georgian-period houses. Ducks and swans make their homes in tucked-away parks under 200-year-old trees.

These squares were once accessible only to the affluent residents in the surrounding houses. Each had a key that would open the heavy wrought iron gates. This was their shared urban garden. Built when Dublin was the second city of the British Empire these houses are near the magnificent parliament buildings, Trinity College and the chic boutiques of Grafton Street. Close by is the trendy nightlife you find in a young vibrant cosmopolitan city.

But the best deals are in Ireland’s midland region. Here bright-green hills of pastureland roll and roll. Hedgerows of hawthorn, holly and ash trees separate fields dotted with ancient oak and ruined castles. Barges drift from town to town along canals that reach the river Shannon as it meanders to the ocean.

You are close to everything in Ireland. It’s a small country. You could drive across the entire country in less than three hours. Surfing, sailing, hill walking, fishing, the world’s best golf, the museums, the vibrant social life…it’s all on your door step.

Why am I telling you this now? Because today we can buy real estate in Ireland in fire sale auctions. The first one took place this April and many more are on the way.

At the April auction properties were snapped up for cents on the euro. Like €30,000 ($44,500) for a three-bedroom home in the midland town of Mullingar…a city center condo in scenic and culture-filled Galway City for €70,000 ($104,000)…and a retail unit a short stroll from where the auction took place in central Dublin for €57,000 ($84,500).

In the 1970 and ‘80s Ireland became a favorite retirement and second home destination for English, Swiss and Germans. Investment bankers became potters in West Cork…some becoming avid horticulturalists living in communes. Germans opened sausage shops in Killarney.

Artists and industrialists together joined local communities, drawn by privacy, the people, and the raw natural beauty of the country. The rich and famous came in their droves. The jet set come and go in Ireland…but in full view. You might see Tiger Woods sitting on a wall eating an ice cream in Waterville, Kerry, Julia Roberts strolling on a beach or Bono and The Edge having a pint on a Thursday afternoon in Finnegan’s pub in Dalkey, County Dublin. They are treated like the rest of us. And, that’s a special experience.

For now, like I said, the best way to buy is a bankruptcy fire sale where hundreds of units go under the hammer and have to sell…at almost any price. But, things are only getting started.

Ireland’s boom of the 1990’s and much of the last decade turned to bust as its banking system imploded and the real estate industry and market crashed. In the boom there was too much construction. Today only a few brave souls have an appetite or funds for real estate. This is a classic crisis or distressed opportunity. There is “blood in the streets.”

The next auction takes place on July 7.  It will feature several farm and home lots. This might be your chance to become a gentleman farmer in the old country. Former “fat cats” are being forced to sell off weekend getaways. If it’s a yield you are after, then rented properties go under the hammer with yields north of 9%. Or maybe you fancy buying a pub in a quaint country village.

But, Ireland is far from out of the woods. The country’s bankrupt. The coming months and years will be the most challenging in 89 years of Irish independence. It’s important to weigh any interesting fire sale opportunity against the prospect that things have just started to get bad in Ireland.

I’ve been an active investor in this market for 12 years. I was fortunate enough to exit (mostly) before things peaked. Here’s my strategy:

• I’m not interested in buying income property for the moment. The yields are starting to look very interesting (double digits) but the tax man is taking more and more and there’s too much uncertainty around the capacity of most tenants to pay.
• I’m not interested in buying any real estate that comes with tax breaks. On paper this looks very appealing. But, at the stroke of a pen this credit could be reversed…taken away if politically expedient. This is a credible possibility.
• I’m not interested in buying a home unless it’s for life. What happens if I want to move? Who would rent or buy my home? Buyers are very thin on the ground today.
• But I am looking for a holiday home in West Cork or Kerry. These are my favorite parts of Ireland. I’m looking for somewhere I’ll always want to have. I won’t care if its paper value fluctuates. This will be my private retreat.  And, if I do need to sell, I won’t have to sell into the Irish market. I could always find a European buyer, one of the many German or British expats who put a premium on the Irish landscape and lifestyle.

I’ll be following these auctions closely. If Ireland is on your radar it’s time you got ready to pounce.

Why Ireland?

Magical landscapes, wonderful culture and friendly locals make Ireland a great place to visit. But there are practical reasons it should be on your radar as a retirement destination as well.

Ireland is English speaking so you can just step off the plane and start talking without the need to learn a language or look up a dictionary.  It’s politically safe and stable. For instance, former trouble spots in the north of the country are now on the beaten track of tour groups and sight-seeing vacationers.

If you are interested in doing business the country’s 12.5% corporation tax is one of the lowest in the world and there is a skilled and well-educated pool of labor. And if you have parents or grandparents of Irish stock you’re eligible for citizenship.

Residents have access to free healthcare and transport infrastructure and telecommunications are on a par with the rest of Europe.  It’s easily accessible from North America and it’s a great base from which to travel in Europe, as there are budget flights to destinations all over the continent.

***************************************************************

Make Money from the World’s Real Estate Trends

When Ronan McMahon isn’t scouting for Pathfinder, IL’s preferred real estate advertising partner, he’s heading up the Real Estate Trend Alert. To follow real estate trends with the potential for profit and to access his recommendations and advice, see here.