I bumped onto this data when looking up something else, but with all the noise made about bubbles, crises and all I can’t help myself, so I’ll post the relevant graph here.
If you would like to have a rough picture of just how big the Irish housing bubble was, look at the following chart.
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| source: OECD |
Gross fixed capital formation for housing (that’s investment) for Ireland during the boom years significantly outshone the one for Greece. If you think that this is no big deal perhaps you should keep in mind that the Irish population is less than half the one of Greece.
I can think of only one thing that maybe reduces the potential size of the bubble. If we look at the data for Greece we can see that activity during the 70s and 80s was more than booming. This is the period that inward migration or urbanization of Greece occurred and the housing stock of Greece was renewed. Such a pre-crisis boom is not visible in the Irish data though. Maybe then, part of the phenomenal surge in activity can be attributed to that. But still…
Maybe this one chart can serve as a reminder that human nature is the same no matter where you go and that human greed can at times demonstrate its presence pretty loudly…
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