Galway Indo: Investor Worry (foreign property)

Link: galwayindependent.com/local- … tor-worry/

Sounds like there’ll be a hell of a lot of people out of pocket.

Strange the company hasn’t been named. Anyone know who it is?

And why is the investor so sure that the banks can’t “lift” the family home.

The Developers name is TG.

He and one other Irish developer, along with a french man, built 440 flats in Tenerife. About 140 of the flats have not been sold yet. Quite a few are only half built.

For Tax purposes the Rents due to the owners (who are almost all from west of Ireland) are paid 1/3 by the french man and 2/3 by the irish duo. Since last August the irish portion of the rent has not arrived.

TG and the other Irish developer are deep in debt. There’s a Luxus that cost €160K being repossesed at the moment. These are the kind of guys that will end up putting bargains on the local market.

Watching things like house hunters in the sun and great escapes a few years ago I remember seeing Brent Pope on the flight over to Bulgaria to look at properties. Don’t know how many on the flight bought but they have clips from a lot of the lads in pub celebrating their purchase and being treated to belly dances, it was a pure robopaddy fest. On one of the programs they were on about the rent being paid for 3 years so there was nothing to worry about.
I’d be pretty feckin worried now if I was one of the purchasers and I wonder how this affects the remortgaging that a lot of the punters used to finance the deals.

Translation = I clearly had no idea I was buying into a shared lease-back scheme, paid over the odds for an apartment I didn’t really own and have been receiving a small fraction of my money back for a few years.

You can predict the IQ of somebody by seeing if they use the word “signage” or “physicality”. It’s no surprise they were all scammed. Perhaps they can recoup their losses with a Monorail system for Galway?

The interesting thing about this sort of default is the knock on effects. These guys should be forced to sell developments here in Galway, ie is if the market was left to run as a market. However with NAMA getting involved we will have a very false market for quiet a few years to come.

The numbers involved here is huge by the sounds of things. Second mortgages? WTF? i wonder how many Irish people are involved in these schemes? The numbers mentioned in the article are big and if that is replicated in every large town in the country can you imagine the effects?

So many ordinary joes caught up in this, we have a few mortgage brokers who are clients, they woudl be sending people down weekly for a few years to get documents signed.

I have one particular client with two apartments in Bulgaria, well one “rented out” and one where he paid a deposit and now can’t close. He has a trade, did well in the boom and has been hit badly. The unbelieveable thing was that he put the deposit down last year after things were even more clearly in meltdown.

It is hitting and will hit people who were only ever equity rich particularly hard. These people didn’t have spare income to invest, just the equity. Now they have even less to make up the shortfall.

As an aside, I wonder how many parents are cursing EBS (i think) these days for persuading them to help out the kids (again from equity)?

I’m still waiting for the Sindo to feature some older couple getting the squeeze from the bank because little Seamus and the mot have scarpered to Australia and left the keys with the bank.

I can imagine such situations leading to “frank exchanges of views”, to use a diplomatic euphemism.

MOD EDIT: Speculating on someone’s profession. Uncool.

I heard alot about this development in the last 24 hrs. It seems that just about everyone in Galway bought one of these flats. The legal situation is very complex. The owners have now gotten themselves together and formed a committee. Thier next step is to throw out the management. This will cost them between €100K and €150K because there is so many of them. The current management will be very slow to let go as the rent from the development is thier only source of cash flow at the moment. It will reck their plans to finish out the development and possible impact on thier irish investments as well.

This is a long messy expensive legal road that may not even deliver results. It will cut the legs out from under alot of the low level punters who fancied themselves as owners of foreign property. IT will impact the Galway property market as well. No NAMA here either as the mortgages were rasied in Spain.

The Tribune has it now

galwaynews.ie/7196-galway-in … -fear-ruin

as in

globalgroupireland.com/home.html

MOD EDIT: removed.

Some names are given in the blurb of Global Group Ireland

globalgroupireland.com/about_us.html

About Us

Sub Navigation

      o 10.1: Tenerife
      o 10.2: France 

Born from the minds of international real estate experts Noel Mc Carrick, Tom Gormally and Bernard Lonis, Global Group International S.A. (GGI) launched its first real estate investment project in 2003 on the French “Côte d’Azur”. It was an immediate success both for the company and for its clients.

Recognizing the potential of the international real estate market, the management team of GGI set their sights on becoming the premier source of profitable international real estate investment opportunities for a growing list of clients from around the world.

Enterprise Synergy
Our consolidated group of companies possesses individual strengths and capabilities that blend seamlessly with each other to provide experience, know-how and synergy. This enables us to develop and promote the concept of ‘Residential Tourism’ in a way that provides our clients with the maximum opportunity to participate in profitable international real estate ownership and investment projects.

Our Services
Every GGI Client can expect:

* Total transparency in leaseback details: We disclose every detail of every leaseback transaction in order to ensure that our clients are fully aware of all terms and conditions. We make every effort to see to it that our leasebacks are a hassle-free way of investing overseas.
* A portfolio of international real estate properties designed to give you the freedom to invest in your preferred destination whenever possible: We stand behind every transaction and are ready to assist you in every step of the process from choosing a property, to buying it and to handling all of the details after the sale. 
* A Rental Guarantee for your new home: Our "Global Package" offers an unprecedented investment opportunity thanks to our agreements with tour operators who are able to provide us with a regular flow of tourists who are ready, willing and able to rent your property. That’s why we are able to provide you with our “Rental Guarantee.” 
* Professional Market Analysis: Analyzing destination values give us the wisdom and foresight necessary to help guide you through the decision-making process. We always keep you abreast of trends and developments in your markets of interest and alert you to possible risks based upon changing economic or political conditions. 
* Full Financial Disclosure: Our in-house financial team fully discloses all you need to know concerning taxes and fees to be paid for notary, mortgages and financing in the country you have chosen for your real estate transaction.

(MOD EDIT: PM’ed poster and requested they not answer queries about profession or personal details.)

I wasn’t asked for advice about either purchase. I found out about the 2008 punt three weeks ago.

I couldn’t give professional advice on foreign investments. I can’t give professional financial advice in any circumstances.

I’m happy to give my personal opinion when requested.

Remember what stifster said, this hits people who were only ever “Equity Rich” very hard . Older people who had valuable houses at the top of the boom but who did not have great incomes.

At the peak of the boom , particularly in 2005 and 2006 the number of remortgages and topup mortgages taken out by Irish people was a good indicator of speculation by these ‘equity rich’ in Bulgaria , Cape Verde, Tenerife etc . Every county in Ireland had shills trying to persuade them to ‘unlock’ equity and ‘invest’ .

Liz O Kane cheerled these shills to every corner of the planet and RTE sadly paid her to do so :frowning:

You can see the scale of it in the link below on page 2. About 40% of ALL mortgages taken out in 2005 and 2005 were a topup or a remortgage …sure why worry with all that guaranteed rental eh !?! The size of the loans is on page 4.

ibf.ie/pdfs/ibf_pwc_mortgage_q1.pdf

anybody buy off Kendar ( Michael Lynn) in Bansko , of so read this ??

forbes.com/feeds/ap/2009/03/ … 36454.html