I spent the past 8 years in the Emerald PIG, and my work was dependant on the construction industry. I’m now in the next bubble – food and agriculture.

Approx 25% of the male working population of Ireland was employed in construction at the peak of the boom in 2007. On the basis of registrations of new completions with the construction industry federation’s insurance arm, the boom had actually peaked by May 2007, long before Lehman bro s bankruptcy, and that was evident visiting the big projects around Dublin, where work force reductions on some sites were around 85% in Spring ’08.

However it was following Lehman’s that the cheques began to bounce, the banks reduced overdraft limits and, I received my first redundancy notice of the crash.

A couple of anecdotes to illustrate the extent of the crash.

A friend’s boss (whom she detested) paid €400,000 for a single bedroom flat in a new and prestigious development in Dundrum, the most fashionable suburb of Dublin. At that time the average first time buyer was paying €250,000 – around 5 times average earnings!

Friend’s boss was one of the few, or possibly the only one, to buy a flat in that block. One of the local councils then took over the remaining flats, to house single mums: She’d paid €400K for a council flat!

During 2007, there were several economists who wrote about the imminence of a crash in Ireland, most famously Prof Morgan Kelly of UCD http://en.wikipedia.org/wiki/Morgan_Kelly_(Irish_economist) who predicted a price drop of around 60%.

(I don’t know which school of thought Kelly follows – the only Misesian whom I know of at UCD is the excellent Philosopher, Prof Gerard Casey http://mises.org/daily/author/1197 )

In response to Kelly’s prediction the then Irish Taoiseach (first minister), Bertie Ahern, said:
“Sitting on the sidelines, cribbing and moaning is a lost opportunity. I don’t know how people who engage in that don’t commit suicide because frankly the only thing that motivates me is being able to actively change something.”

During my visit to Ireland last month, the property price fall was said to be more like 75%, and the prospect of a new property tax can only contribute to that fall as it’s impact is capitalized and deducted from selling prices.

I don’t know what has happened to the “investment properties” Bulgaria, however, closer to their homes, Ireland is reckoned to have around 2,800 ghost estates:

http://www.irishtimes.com/newspaper/ireland/2011/1014/1224305756663.html

http://www.irishtimes.com/newspaper/ireland/2011/1025/1224306446050.html