Sinn Féin spokesperson on Finance Pearse Doherty TD has responded to changes made by the Central Bank to mortgage lending rules.
Speaking this afternoon, Teachta Doherty said:
“The announcement today that the Central Bank will change its mortgage lending rules is a significant change in policy.
“For years, the Central Bank had warned that loosening these rules would risk undermining borrowers’ resilience and increase house prices.
“It is clear that the regulator has decided to loosen the lending rules as a result of the government’s abject failure in housing – low delivery, spiralling house prices and a generation locked out of home ownership.
“This is not without its risks, and I am deeply concerned by the Central Bank’s acknowledgment that these changes will increase house prices and lead to greater mortgage debt for households – especially at a time of rising interest rates.
“The reality is that the government’s housing failure has pushed the regulator into a space where higher house prices and mortgage debt is seen as a solution to affordability issues in the housing market.
“The government need to recognise that their housing plan has failed and the housing crisis is only getting worse. The only real and sustainable solution is a greater delivery of social and affordable housing.
“Chasing spiralling house prices with more money and debt is a serious risk.
“The Central Bank estimate that today’s announcement will increase mortgage credit in the market by 8 percent and further increase the gap between incomes and house prices.
“While a number of the measures – for example, changes with respect to those who are divorced or separated and greater account paid to rental payments – are welcome, I am deeply concerned that these changes have been deemed necessary by the Central Bank, given their expected impact on house prices and the resilience of borrowers.”