Things couldn't have gone much worse for the property sector this year, with prices continuing to fall and the outlook remaining distinctly gloomy. The construction industry will hope that a new National Treasury Management Agency bond to which the public can subscribe will create some impetus for public infrastructure projects.
If anything, the year was defined by the fall of Liam Carroll, the developer who owed €2.8bn to the banks. Carroll buckled under a huge working capital problem and the collapse in the value of properties in his ownership. He has already lost control of his Zoe Group, and Ulster Bank has begun moving against part of his Orthanc empire. The Sunday Tribune led the way in highlighting layoffs by the developer, his huge stock-market losses and his ongoing financial struggles.
Popular rival Paddy Kelly also dominated the headlines by admitting he was considering a bankruptcy scheme of management, while the Fleming Group and Taggart Holdings also faced difficulties.
A number of developers only remain in business because their lending was from institutions covered by the British asset assurance scheme, meaning there is no need for the lenders to move against them.
On the investment side, appetite was obviously muted but it was also noticeable how few transactions got across the line. The proposed sale of a number of blocks at AIB Bankcentre, the first attempt to sell Liffey Valley shopping centre and a number of Dublin city-centre investment transactions all collapsed. Reports in Britain say a new deal for a stake in Liffey Valley is now on the table. Meanwhile, Green Property's attempt to buy properties that Anglo Irish Bank bought but failed to syndicate to private clients continues to roll on, with the process described as painstaking.
On the other hand, it was a relief of sorts to see that foreign investors believed there was some value in the Irish market. German funds Deka and GLL, a Middle Eastern investor, and Credit Suisse – which has rented some space in Dundrum – all showed interest in acquiring Irish property during the year, particularly prime assets. Orion Capital, JP Morgan, London & Regional and Area Property Partners also showed interest, with Area looking set to acquire a stake in Liffey Valley, according to reports in Britain. Whether the ban on upward-only rent reviews puts the overseas funds off completing transactions remains to be seen.
Overseas, the Irish have become sellers of property, with a mini-bubble in London at present as the wall of global money chasing scarce product means that values of some properties have soared.
The office sector was characterised by a lack of deals despite the incentives on offer from developers under pressure to let space. The state's decision to concentrate its properties and let surplus space go is also affecting the market.
That said, Forfás is paying developers Bernard McNamara, Jerry O'Reilly and David Courtney nearly €1m a year for offices in Ballsbridge, Dublin 4, that are lying empty.
The hotel sector had a torrid year with the market at a standstill as buyers await the outcome of Nama. The outfall from the tax incentives for building new hotels will continue to affect the industry for years to come.
Elsewhere, the industrial market has a high vacancy rate and most occupiers are now only interested in letting rather than buying space.
On the residential side there wasn't much cheer either with house prices said to be down by nearly 20% on average across the country. That said, there remains a gap, often significant, between vendors' expectations and what somebody is willing to pay.
For those who do decide to buy, the banks have made mortgage-borrowing difficult.
The fact that mortgage interest relief was extended for those in negative equity will alleviate the pressure for some who got caught up in the euphoria but the signal that a property tax is imminent may dissuade some first-time buyers.
The tax may be coming sooner than we think – as of September the Property Registration Authority said 93% of the total land mass of the state and almost 88% of the legal titles in Ireland are now registered with the Land Registry.
Perhaps homeowners will be facing a property tax within two years.