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Rainy day fund gone but Killarney will bounce back – says newly elected Chamber president

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If any town in the country has the capability and resolve to recover from the economic and social devastation caused by the Coronavirus it is Killarney but it will take time and initiative, the newly elected President of Killarney Chamber of Tourism and Commerce has said.

Cllr Niall Kelleher, whose two-year term at the helm of the organisation commences this month, said there are very significant challenges ahead for businesses but they must rise to meet them with innovative thinking and sheer willpower.

"I am very much aware that many businesses in all sectors, from retail to hospitality, have been devastated by the events that have occurred since last March and that, in many cases, the rainy day fund is now gone," he said.

“There is huge resilience out there, however, and if any town is equipped to bounce back, it is Killarney because of its infrastructure and its natural advantages as a world class tourism destination. We saw that during the few months businesses were allowed to reopen in the summer and Killarney became the number one destination of choice for so many people. As we prepare for a post-COVID world, big opportunities to rebuild will be provided through our National Park with a focus on the great outdoors to promote fitness, health and adventure."

Cllr Kelleher, who is a member of Kerry County Council for the Killarney Municipal District, said while great benefits for businesses exist online, people must remember that money spent locally circulates in the local economy and locals must support locals.

CHALLENGE

"The big challenge for Killarney over the next two years will be to get back on the path we were on before the virus struck and to work to further enhance the wonderful destination we already have."

He said the progress to develop Killarney as a gateway to the Wild Atlantic Way would bring significant advantages and Chamber will play its part, working with all the other agencies, to ensure it is implemented.

It was hugely positive news, he said, that Killarney was chosen as one of two pilot areas to test the gateway concept over a three-year period as the Wild Atlantic Way has been a phenomenal success.

Another of his priorities during his term as president will be to continue to work with the relevant authorities to tackle traffic congestion in Killarney which was a major issue prior to COVID and will be again when the town gets back to normal.

“Everybody must work towards the ultimate goal of getting the outer relief road from Farranfore to Killarney underway as it is absolutely vital that the project is brought to shovel ready stage as soon as possible,” he said.

Cllr Kelleher said he is looking forward to the new cycleway from Ross Road to Muckross Road being completed as it is a hugely exciting initiative and there are several other infrastructural projects in the pipeline which the Government has pledged to support.

On a personal level, Cllr Kelleher acknowledges that he is facing a very busy two-year period combining his Chamber duties with his role as a councillor but, he insists, he is more than up for the challenges it will present.

“I have been a member of the Chamber for many years and vice-president for the last two, and I have seen that the organisation shares many common goals with the Council.

“Sometimes, of course, there will be different views but that can only lead to healthy debate as we are all working with one goal in mind and that’s to create a better Killarney and to ensure it continues to prosper as a wonderful town to live in and to do business in,” he stated.

Cllr Kelleher thanked outgoing Chamber president, Paul Sherry, for his enormous work and the huge commitment he demonstrated during his two-year tenure.

“It sounds a bit of a cliché, but I have a very hard act to follow. Paul had a vast amount of knowledge, particularly from a retail perspective, and he did an excellent job,” he said.

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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, […]

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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.

Interest rates.

Artificial Growth

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.

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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 […]

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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.

 

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