First time buyers won’t be punished for a crash they did not cause – Deering

28th January, 2015

Fine Gael TD for Carlow/Kilkenny, Pat Deering, has today welcomed the Central Bank’s common sense approach to the issue of mortgage deposits, saying it is good news for first time buyers.

“The announcement by the Central Bank that 10% deposits will apply to first time buyers is very welcome as part of an overall responsible approach to mortgage lending.

“The rumours of 20% deposits for everyone had a lot of first time buyers very worried, but this shows a real common sense approach.

“There is a conflict between keeping rental and purchase prices under control. Favouring one in particular affects the other and it is important to ensure balance across the housing market.

“The new rules will mean that first time buyers will have to provide very reasonable 10% deposit for a house, valued up to €220,000. While a 20% deposit will be required for any amount above this price, or for non-first time buyers, it is important to note that anyone in negative equity will fall into this category.

“The new Central Bank rules will help prevent us returning to the crazy unsustainable lending of the Celtic Tiger era. A good example is the fact that the Central Bank is retaining the 70% loan to value limit for buy-to-let loans. Nobody wants to go back to those days and risk another property bubble and destructive economic crash.

“This common sense approach from the Central Bank is very welcome to ensure a sustainable property market that won’t punish first time buyers for a crash they did not cause.”