NAMA asset chief warns against UK housing-market intervention
EUROPE – The head of asset management at Ireland's NAMA has warned UK politicians they risk damaging the housing market if they attempt to intervene in it.
"I come from a country where a lot of people wish they didn't own their own homes," head of asset management John Mulcahy told an industry audience in London this week.
"When the government intervenes in the housing market, the question is not how much good it will do but how much damage."
He said NAMA, which the Irish government set up in 2009 to manage property loans offloaded by Irish banks, had been "a big investor" in London residential because properties offered "decent value" and there was a clear infrastructure programme for the capital.
But he added that any attempt to change the rules would likely damage investor appetite for residential.
"If you keep changing the rules, you'll drive everyone mad," he said. "Whatever the rules, investors need to know they'll be the same in a couple of years' time.
"You'll have a big increase in housing over the next 3-5 years. My plea would be, don't interfere too much. Decide the rules and move on."
He contrasted the UK with unspecified Eastern European markets, saying: "The local government officials I met in London could not have been more pragmatic and, above all, honest – and that's a rarer commodity than you might think.
"Don't underestimate transparency, fair dealing and a good judicial system – especially for the resolution of commercial disputes."
Despite earnest efforts to avoid commenting on the detail of the UK market, Mulcahy – appearing on a panel that also included former mayor Ken Livingstone – was drawn into questions not only on UK housing but on the infrastructure legacy of the London Olympics.
He said that although construction of the Olympic Village had been managed wisely, "if you're looking for a follow-up, there is little evidence it happens".
Yet he sidestepped criticism of the UK's poor recent record on transport infrastructure, with a muted sideswipe at the capital's notoriously unreliable underground network.
After fellow panellist and Newham mayor Robin Wales described the UK as "the only country that can build an international train station that trains don't stop in", Mulcahy said he had recently discovered London buses, "the eighth wonder of the world".