Finance Minister Michael Noonan sought advice from Nama on how to control supply and demand in the property market, according to just-released minutes of Nama board meetings. In a highly unusual move, the minister effectively asked Nama to suggest solutions for managing a market which has historically been left to free enterprise.
At a Nama board strategy meeting on February 5 last year, Mr Noonan raised the “consideration” for Nama “to provide inventory of green and brown field sites, and advise on a mechanism to control supply/demand of land”. “Referring to the boom/bust nature of the Irish property market, the minister requested Nama to consider a strategic solution to this historic problem and whether Nama or an alternate state development agency could be charged with holding land and releasing/withdrawing it as appropriate to regulate the market,” the minutes of the meeting state.
A department of finance spokesman said Mr Noonan “would have been aware of the expertise that became available because of the remit of Nama and would have been interested to hear their views”. “Nothing concrete happened on foot of the meetings,” he added.
Even so, the fact that Mr Noonan raised the issue of controlling supply and demand of the land market stands in stark contrast to how that industry has been managed in the past, and the perceived “arm’s length” nature of the relationship between Nama and the department of finance. The emergence of the minister’s request comes as he pressures AIB and Bank of Ireland to cut their mortgage rates – pressure that Bank of Ireland has resisted so far. Nama does not have a formal role in managing supply and demand in the market, but it does sit on the Housing Supply Coordination Task Force for Dublin.
That body is tasked with “working together to identify housing developments that have planning permission and that are capable of being delivered in the short term”. This includes “monitoring trends in the supply of viable and market-ready approved developments”. That body was set up under the Government’s Construction 2020 plan. Nama is seeking to repay 80pc of its bonds by 2016 and is preparing to sell loans tied to Dundrum Town Centre.
80pc – Proportion of Nama bonds to be repaid by end of 2016
€250m – Value of assets Nama will bring to market every quarter
€1.4bn – Value of loans tied to Dundrum Town Centre which Nama is about to sell
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