Could the limits be phased in?

Brendan Burgess

Brendan Burgess

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It will be very tough for people who have saved up and are just approaching the 10% deposit, to find it doubled overnight.

Could it be raised in stages?

15% from 1 July 2015.
20% from 1 July 2016.

Brendan
 
Could it be phased in where purchasers who have the 10% or more now pay the balance of the 20% over 5 years in 60 monthly instalments.

They would have to be stress tested for this. It might allow some extra people onto the property ladder.

I know that the early stages of ownership are often the hardest but it was never easy prior to the crazy times in the recent past to own a house. We never want to go back to the crazy times again.

The real problem is the supply situation where the demand exists and until that situation resolves itself there will remain a "bubble" situation.
 
Dermot said:
Could it be phased in where purchasers who have the 10% or more now pay the balance of the 20% over 5 years in 60 monthly instalments.
Click to expand...

A neat solution, but how would you implement it?

If someone buys a house for €300k, they have saved €30k. They would need to pay a further €6k year over the next 5 years on top of their mortgage payments.
 
I am just giving it out there as another option which would be paid as an extra €500 per month with the mortgage in the scenario you have given. It would be part of the mortgage agreement. I know it would not suit everybody. It is workable from a deduction point of view.
 
20% deposits seem too high to me. 15% seems more reasonable. It requires discipline to save 15%, it protects the banks against a fall in prices & fits in with a more prudent lending policy. To announce these potential changes in October & say they will be implemented in Jan is a rush-job. It has to have an impact in the housing market but no-one can yet predict what that will be.
 
Say someone is hoping to have 40000 ie 10% by next year for a 400000k house, they will have to cast their sights on one for 200000, but I don't think that would happen. So they are stuck renting for many more years or compromise on the type of house they can choose.

But someone on an average wage who has busily saved 20000 for a 200k house next year will have no choice , unless they choose in a small rural village or such. There are many houses available @100000k 'down the country' but amenities and transport leave much to be desired.

Is there a deeper motive behind this 20% notion ie to get movement on these house type referred to above.

Or is it simply that the CB wants no egg on its face or allegations in future years that it sat on its hands.

20% is too high as a deposit 10 is fine but I agree on the loan to income threshold proposed as a means of curbing prices.
 
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