To Burst A Bubble

Something monumental is happening in Ireland. The property bubble which has lasted this long decade, has begun to burst.And I for one, welcome it in.

Ireland has long watched the value of its property assets rocket skyward. House prices have climbed by double digits, year after year, after year. The government has toasted record tax receipts with champagne and multi-billion euro surpluses. Home owners have celebrated becoming accidental millionaires by buying BMWs befitting their new found wealth. Everyone with a stake in the market cheered "boom"!

Those with vested interests, property owners, market speculators, landlords, builders, real estate agents, and the government, were all being too blinded with cash to stop and wonder where the money was coming from, and how this apparent bonanza could be our ruin in the making.

At the same time, another segment of the Irish population, those not already on the so-called "property ladder", watched with despair as their chances of ever owning a home to live in vanished into the distance. For these young people, the "property boom" only made them feel poorer. This despite the fact that these were the same people driving Ireland to its new levels of productivity and international competitiveness.

Ireland has deluded itself these last several years, into thinking it was richer than it was, by imagining the value of its property to be more than it is really worth. And what is worse, it borrowed and spent all that imagined wealth away. For Ireland, it is time to face reality. The debt collector is at the door.