Olga Tkachenko and I run five kilometres every Saturday with the Killarney House Parkrun.
This fragile and smiling woman always runs easily and beats me every time.
It seems that everything in her life is as easy as jogging.
But this is not quite so.
Olga grew up in Donetsk city, Donbass region. Her sister Maryna and parents lived here. A large and friendly family, they owed a holiday home in the region and would gather there for vacations and holidays. This house was a symbol of this family.
In 2014, Russian troops entered Donetsk and drove their military equipment right into the yard of the house.
From here they started shelling the Donetsk airport.
Soon the house was completely destroyed. All that remains of the house are two walls and a few pots. The family nest was devastated. Her sister Maryna tried to save the surviving property and came under fire. Fortunately, she was not injured.
Olga moved her parents to another place, and she went to Kyiv with her husband and children. All they took with them were two laptops and a few warm things. Life had to start from scratch.
Olga's sister Maryna moved to Dnipro city, where she found a new job.
The sisters went their separate ways, but still maintained a very close relationship, calling and supporting each other every day.
Maryna's husband and Olga's husband are brothers and share the same last name – Tkachenko.
They have children two months apart. Olga jokes that she and her sister have a topic to talk about - their common father-in-law and mother-in-law.
Having lost their homes in 2014 due to Russia's military aggression in Donbas, the sisters built their lives in two different cities - Irpen (near Kyiv) and Dnipro. But when the war broke out in 2022, they found themselves together again.
The sisters managed to board an evacuation train bound for Poland. Again, they only had one bag each and a one-way ticket.
"Fear drove us as far as possible. The main goal was to save the children. We did not know where we were going. We wanted to escape as far as possible from the war and the borders of Russia," says Olga.
After staying in a refugee camp in Poland for several days, they decided to go to Ireland.
Were they worried about going into the unknown?
But Olga says that when she is together with her sister, it gives both women confidence and stability. Together, it's not so scary anymore.
Olga says that it is impossible to get used to the fact that you lose your home every time and get used to life. It is impossible to accept that everything has to be started from new.
But she has one secret of resilience - the ability to see the good in the circumstances in which you find yourself.
Here in Killarney Olga focuses on the beautiful nature, she learns a new language, and goes jogging. She never regrets.
Olga's sister Maryna Tkachenko has already found a job and works in as a designer in Killarney. The sisters help each other a lot and are very worried about their parents and grandmother, who remaine in Ukraine.
"Our parents spent a month under the occupation of Russian troops in a village near Kyiv. My 70-year-old mother, as in 2014, went to negotiate with Russian soldiers and persuaded them not to shoot. We are glad that our parents' house survived this time. Because in 2014 we already lost one home. Our parents would not have survived this a second time," adds Olga.
That is why she will soon go back to Ukraine.
She explains her motives: "I want to be where I am most needed. My eldest daughter, parents and grandmother are in Ukraine. My daughter works as a volunteer every week, clearing the rubble of buildings, so I want to help my country as well. After dismantling the ruins, we will see our beautiful country again."
Housing Will Never Be The Same
Last week I wrote about the pathetic investment options out there for Irish investors. Despite high ongoing fees (mortgage, maintenance, insurance etc.) and the actual headache of being a landlord, […]
Last week I wrote about the pathetic investment options out there for Irish investors.
Despite high ongoing fees (mortgage, maintenance, insurance etc.) and the actual headache of being a landlord, it’s easy to see why real estate functioned as the de facto investment portfolio for an entire generation.
Wealth creation was a rinse-and-repeat function where couples put money away until they had enough for the ‘next house’. As a result, we have an economy where 70% of household wealth is tied up in real estate.
Driven by the profits it created, Ireland became obsessed with owning real estate.
But real estate as an investment won’t be nearly as successful for our generation. (If you are able to get a house, that is)
All you have to do is look at the anecdotal evidence all around us to confirm this.
My parents bought the house they currently live in for 30k (pounds) 35 years ago. The house is now worth roughly 450k.
I typically despise these back-of-the-envelope calculations when It comes to property, given the endless variables and ongoing costs involved, but bear with me.
That’s a gross return of 15 times the original value. Now there are upgrades, a change in currency and other adjustments to consider here, so for argument’s sake, let’s call it 10X.
To achieve the same level of growth over the next 35 years, you would be left paying 4,500,000 euros for what is a pretty modest house.
Sure, we will still see property prices increase over time, but the rate of growth won’t be anywhere near as meaningful for one simple reason.
Over the last 30 years, real economic growth has been stagnant, yet Ireland has experienced enviable nominal growth.
How did we manage it?
We created imaginary wealth.
We pushed interest rates lower and lower to stimulate economic growth.
And it worked.
After all, if you make 100k/year you can probably afford a 400k mortgage at 4%. At 2%, with the same 100k/year salary you can now take on 600k in debt.
So, were we getting richer, or was the debt just easier to afford?
Where do we go from here?
We have now squeezed interest rates as low as they can go.
The house price appreciation we have seen was justifiable because the mortgage rates on housing continued to fall in recent decades. This allowed people to take on more debt without severely impacting their ability to repay that debt.
If we go back to my parents, they were paying 14% on their mortgage. Mortgage rates are currently between 2 to 3%.
A relentless drop in interest rates gave way to higher and higher prices for houses, but interest rates are now on the floor.
The juice has been squeezed.
In fact, the trend has started to reverse, with rates expected to rise 1.5% in the first half of 2023
Be mindful that the same credit expansion cannot happen again.
How the next generation thinks about their investment options has to change.
Banks offering 0% returns for the use of your money and a housing ladder you can’t get on are not your only two options.
If you need help creating your own investment portfolio, just reach out to me at mike@theislandinvestor or simply scan the QR code above.
Biddies performance celebrates St Brigid
Two local Biddies groups performed at Muckross House as part of St Brigid’s Day celebrations in aid of Kerry Parents and Friends Association. The Killarney Parents and Friends Biddy Group – formerly […]
Two local Biddies groups performed at Muckross House as part of St Brigid’s Day celebrations in aid of Kerry Parents and Friends Association.
The Killarney Parents and Friends Biddy Group – formerly known as the Beaufort Biddy Group – and Kilgobnet Biddies came together for the event.
The tradition of the Biddies is one of the oldest and most colourful customs in Ireland, a blend of pagan and Christian pageantry, held on February 1 each year, heralding the beginning of springtime and honouring St Bríd the patron saint of the farming community.
Master traditional craftsman, Pat Broderick, at Muckross House, was also part of St Brigid’s Day celebrations, making a St Brigid’s Cross as part of the traditions.
Housing Will Never Be The Same
Last week I wrote about the pathetic investment options out there for Irish investors. Despite high ongoing fees (mortgage, maintenance,...
Biddies performance celebrates St Brigid
Two local Biddies groups performed at Muckross House as part of St Brigid’s Day celebrations in aid of Kerry Parents and Friends...
Arrest made in Miriam Burns murder case
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Paudie Clifford returns and scores wondergoal as Kerry dismantle Monaghan
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