So this is Christmas, as John Lennon used to sing. But it's not going to be a happy one for some Irish people, despite the recent remarkable recovery in our economy. These are the people caught in the housing crisis, and we will come back to that sorry story in a moment.
But first a word about the turnaround in the Irish economy, which has been extraordinary. Just five years ago our banks were bust, the economy had crashed and the country was in an IMF bailout to keep cash machines working and essential services like schools, hospitals and police functioning.
That was then ... and this is now. Last week, the official figures released here showed that economic growth in Ireland in 2015 has hit seven percent, the highest in the developed world.
We're even ahead of China which is on 6.9 percent growth this year. We're over three times better than the U.S. on 2.1 percent growth, and over four times better than the EU average of 1.6 percent growth this year.
So what's going on in Ireland? Most of it is down to the multinationals, the big foreign companies here (mainly American), which did very well in 2015.
Our overall exports were up 12 percent this year, and a lot of that was due to the multinationals who continue to invest heavily here. Our exports are now 40 percent higher than they were in 2007 at the peak of the boom.
The important point about this strong economic growth is that it is built on exports and on domestic spending which grew 3.5 percent this year as confidence returned. Unlike the bad old days, the growth here is not built on a property bubble.
So it's going to be a happy Christmas for many people here, with some money to spend and new hope of a better future. But it won't be for everyone, and one of the main reasons for that is, once again, property. Like it or not, we have seem to have a real problem with property in Ireland.
One of the biggest issues the Irish government is facing now is what everyone here refers to as "the housing crisis." For a supposedly well-off country we have an embarrassing number of people who are becoming homeless – up to 70 families a month – either because they can't keep up with mortgage payments, or in most cases because they can't afford the high rents that are now the norm.
The housing market in Ireland is a mess and no one – including the government – seems to know what to do about it. To put it very simply, we don't have enough homes – houses or apartments – for our growing population.
Currently we are building about 13,000 homes annually, whereas we need at least 25,000 just to keep up, and there is also a big backlog of people searching for secure accommodation. The mismatch between supply and demand is the legacy of the financial crash when the Celtic Tiger boom turned into bust. At the center of this was the collapse of the property market which resulted in developers and builders going under and construction workers emigrating in their thousands. The construction sector came to a complete halt, and despite the recent upturn in our economy it has only partially recovered.
This has impacted both ends of the property market. Because of the crash the state did not have the funds to build much social housing over the past five years to rent to low-income people who cannot afford to buy their own homes. And the shortage of supply and new restrictions on borrowing to prevent another bubble has meant that people who used to be able to buy homes now find they can no longer do so.
This has resulted in far more people needing to rent in the private sector, and with an inadequate supply of available rental properties rents have soared. For many people they are far too high and the result is a growing problem of homelessness which is worst in the Dublin area but is also evident in other cities.
Walk though Dublin city center any night and you will see homeless people bedding down in doorways. This reached a crisis point one night last winter when a homeless man froze to death in a doorway just yards from the gates of the Irish Parliament. That case led to a public outcry that something had to be done, and the government did provide more beds in shelters for people who were sleeping rough.
Those extra beds are now full every night and there are still rough sleepers on the streets. To ease the pressure, a new hostel with an extra 100 beds has just opened in Dublin, and there is a new all-night cafe where homeless people are allowed sleep on the floor.
But it's not just the so-called rough sleepers, many of whom have addiction and other issues, who are in difficulty. As the housing crisis here has worsened in the past year, people of all kinds who used to have homes are ending up on the streets because they can no longer keep up with a mortgage or pay the soaring rents that are being asked.
The social housing that is provided by local councils for people who can't afford to buy their own homes is completely inadequate to meet the increasing demand. Right now there are more than 700 families, including 1,500 children, who are living in what is called emergency accommodation, mostly in cheap hotel rooms around Dublin.
To keep them off the streets, the local councils pay for the rooms. It sounds okay, but in fact it is a miserable existence, particularly for the children, with one room to a family and few facilities.
That is the problem at the lower end of the scale. But the housing crisis is also impacting people further up the social ladder.
The acute shortage of new homes being built over the past two years has caused house prices in general to shoot up. To stop another property bubble emerging, the Central Bank recently issued new rules to restrict buyers to loans of 80 percent of the purchase price and 3.5 times their income. With even ordinary homes in Dublin costing €300,000 to €350,000, this puts them out of reach for many buyers.
This means that even more people are trapped in renting, adding to the pressure. Coupled with the shortage of available rental properties, it has led to the rapidly increasing rents we have seen over the past two years.
The state does provide rent supplement payments for low income families renting in the private sector, but this is pitched at a level which is now well behind market prices. So far the government is refusing to increase these rent supplement payments because they believe, with some justification, that it will simply result in rents going even higher. And it is these families who are now facing desperate situations, sometimes ending up on the streets.
The core of the problem, as we said, is the lack of supply and particularly the lack of new builds. Even with prices going up, many builders and developers are still very cautious about starting on new sites. One of the problems is that the banks are now much more cautious about lending to developers and expect them to provide a large amount of the investment themselves upfront.
The economic recovery has seen an increasing number of young people coming to Dublin as more jobs are created – unemployment here which peaked at over 15 percent after the crash is now down to just over nine percent – and they all need somewhere to live. Unable to buy, they rent.
You would think that with soaring rents, more investors would be getting into the rental business. But in fact the reverse has been happening.
Many landlords – particularly the Mom and Pop landlords who bought an extra property or two during the boom as a pension investment – are now getting out because of the penal tax regime they face and the hassle involved with tenants who can't keep up with rent payments.
Nearly 30,000 of these amateur landlords are behind in their mortgage payments and are in negative equity because they bought in the boom. The banks have started to repossess some of these rental homes, evicting tenants so they can sell the property. There are dozens of such repossession cases before the courts here every month now.
There are also dozens of cases involving people who bought homes to live in themselves and who are now way behind in mortgage payments. In these cases the courts are very slow to force people out if they make any effort to pay, but the stress for everyone involved is immense.
The result in general is that far more people are looking for a place to rent at a time when there are few extra rental properties coming on the market. Hence the soaring rents.
To combat the speed at which rents are going up, the government recently announced new measures which will mean that rents can only be increased every two years in future. This may help somewhat, but it is also spooking amateur landlords and making them more determined to get out of the business.
Since the establishment in 2004 of the Private Residential Tenancies Board here the whole sector is now heavily regulated. Of course this is a good thing, but it is heavily weighted in favor of tenants, including tenants who don't pay and wreck property. Landlords now find it impossible to evict problem tenants without very lengthy delays, often of a year or more, and all this has added to landlords wanting to sell up.
Faced with increasing demands that something be done to alleviate the housing crisis, the government recently announced plans to develop 35,000 social housing units over the next five years. Finance Minister Michael Noonan also announced in the budget that Nama – the National Asset Management Agency set up to take the bad property loans out of the banks – would build 20,000 homes between now and 2020, with over 90 percent of them in Dublin. Nama has a huge portfolio of development land and unfinished properties on its books, but it has no experience in building.
There is a good deal of skepticism about the delivery of both plans. And the Nama plan in particular has raised fears that the state bad bank may distort the market and make it even more difficult for individual developers and builders to raise finance.
A further aspect of all this has been the arrival over the past few years of the so-called vulture funds, some of them American, which have been buying up huge property portfolios from Nama on the cheap. Most of these portfolios have been in commercial property, but some of these funds have also been buying up apartment and housing portfolios, and the expectation is that they will be increasing rents as much as they can.
Overall, as we said, the whole property market here is a mess. Even if one takes a positive view of what the government is doing to try to sort it out and to increase availability and affordability, the fact is that it takes at least two years from the time a shovel is put in the ground to the point where a new property is ready for occupation.
For people caught in this mess left behind by the property bubble and the financial crash the immediate future is a bleak prospect, despite our rapidly growing economy. Here's hoping that for all of them there will be room at the inn somewhere this Christmas.