PRS refers to the private rental sector.
Why mortgage interest relief should not be reintroduced
- Thread starter Brendan Burgess
- Start date
Don't know if anyone has heard this yet, but a certain someone was on the Irish Times' Inside Business Podcast this week, talking about this very topic. Good interview I thought.
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www.irishtimes.com
Why giving tax relief to mortgage holders is not a good idea
Inside Business podcast with Ciarán Hancock
Is this not just a vote-buying exercise by certain politicians?
The Central Bank’s March 2023 statistical release on mortgage arrears shows declines in the number of PDH accounts in arrears over 90 days and also a fall in the number of accounts in long term arrears. 2023q1_ie_mortgage_arrears_statistics.pdf (centralbank.ie)
I know we are not given to evidence-based policy making in this country, but whatever your views on having mortgage interest subsidies paid for by the taxpayer, there would not appear to be much to support the argument that mortgage holders, at this point in time, are excessively squeezed by current mortgage rates, as arrears are declining in both the short- and the long-term.
Also, in Jan 2023 the CBI reduced the quantitative restrictions on mortgage lending to allow first-time buyers to borrow up to four times their gross annual income, while retaining the loan-to-income cap of 3.5 for second-and-subsequent-buyers. CBI justified the lower thresholds for FTBs stating that FTBs are a “lower-risk” (to lenders) than SSBs. So according to the CBI FTBs “are more likely to experience income growth during their mortgage, making their loans easier to sustain over time,”. Mortgage Measures - FAQ | Central Bank of Ireland | Central Bank of Ireland.
So, no real cause for alarm then?
The Central Bank’s March 2023 statistical release on mortgage arrears shows declines in the number of PDH accounts in arrears over 90 days and also a fall in the number of accounts in long term arrears. 2023q1_ie_mortgage_arrears_statistics.pdf (centralbank.ie)
I know we are not given to evidence-based policy making in this country, but whatever your views on having mortgage interest subsidies paid for by the taxpayer, there would not appear to be much to support the argument that mortgage holders, at this point in time, are excessively squeezed by current mortgage rates, as arrears are declining in both the short- and the long-term.
Also, in Jan 2023 the CBI reduced the quantitative restrictions on mortgage lending to allow first-time buyers to borrow up to four times their gross annual income, while retaining the loan-to-income cap of 3.5 for second-and-subsequent-buyers. CBI justified the lower thresholds for FTBs stating that FTBs are a “lower-risk” (to lenders) than SSBs. So according to the CBI FTBs “are more likely to experience income growth during their mortgage, making their loans easier to sustain over time,”. Mortgage Measures - FAQ | Central Bank of Ireland | Central Bank of Ireland.
So, no real cause for alarm then?
I misundertsood earlier, thanks for the correction.
The concern remains though re: the cost to the State of picking up the tab in HAP etc costs for 'Generation Rent'.
Brendan Burgess
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I discuss the proposal on the Irish Times Podcast
www.irishtimes.com
Why giving tax relief to mortgage holders is not a good idea
Inside Business podcast with Ciarán Hancock
Because the interest rates are raised to curb consumption and although I have a mortgage I would still have to finance any "relief" with my taxes in the end.
Historically the interest rates are still low. Still didn't see any reason for mortgage interest relief.