Brendan Burgess
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The Irish Times published this as their lead story on Thursday after the mortgage measures were announced.
www.irishtimes.com
The Central Bank’s decision to maintain mortgage lending limits will keep people in a “rental trap” at a time when those home-lease costs are running at a record high, according to consumer activists and financial advisers.
The only quote from a consumer activist was
Dermott Jewell of the Consumers’ Association of Ireland said many young people paying “exorbitant” rents will “never get on the property ladder unless they have significant input from their parents”.
As far as I know, the Consumers Association has never commented on mortgage matters - interest rates, arrears or trackers. They have done a "rent a quote" like this one, but they have not commented on the issue.
I sent this letter to the Irish Times but they did not print it.
Sir,
Your lead article in Thursday’s paper gave the impression that consumer activists were opposed to the Central Bank’s mortgage rules. Nothing could be further from the truth.
Any consumer activist who has worked with borrowers in mortgage distress over the last ten years fully supports the Central Bank’s efforts. No one should be borrowing more than 3 ½ times their income. In a country where the courts allow people to stay in their home for 8 years without making any mortgage repayments, no lender should lend more than 80% of the value of a property.
Runaway lending would only increase house prices and have little or no effect on the supply of housing. It is not the role of the Central Bank to solve the dysfunctional housing market. If the Government wants to increase the supply of housing, it should address how its own policies are adding to the price burden of new houses - 13.5% VAT, social housing levies and development levies.
As Cantillon said in the same edition, the Central Bank is right to protect borrowers and banks from themselves.
Brendan Burgess
Askaboutmoney.com
Central Bank’s unchanged mortgage rules ‘fuelling rental trap’
Calls from politicians and bankers to loosen contentious lending caps resisted by governor
The Central Bank’s decision to maintain mortgage lending limits will keep people in a “rental trap” at a time when those home-lease costs are running at a record high, according to consumer activists and financial advisers.
The only quote from a consumer activist was
Dermott Jewell of the Consumers’ Association of Ireland said many young people paying “exorbitant” rents will “never get on the property ladder unless they have significant input from their parents”.
As far as I know, the Consumers Association has never commented on mortgage matters - interest rates, arrears or trackers. They have done a "rent a quote" like this one, but they have not commented on the issue.
I sent this letter to the Irish Times but they did not print it.
Sir,
Your lead article in Thursday’s paper gave the impression that consumer activists were opposed to the Central Bank’s mortgage rules. Nothing could be further from the truth.
Any consumer activist who has worked with borrowers in mortgage distress over the last ten years fully supports the Central Bank’s efforts. No one should be borrowing more than 3 ½ times their income. In a country where the courts allow people to stay in their home for 8 years without making any mortgage repayments, no lender should lend more than 80% of the value of a property.
Runaway lending would only increase house prices and have little or no effect on the supply of housing. It is not the role of the Central Bank to solve the dysfunctional housing market. If the Government wants to increase the supply of housing, it should address how its own policies are adding to the price burden of new houses - 13.5% VAT, social housing levies and development levies.
As Cantillon said in the same edition, the Central Bank is right to protect borrowers and banks from themselves.
Brendan Burgess
Askaboutmoney.com