The new limits will have little impact if there is no bubble

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Brendan Burgess

Brendan Burgess

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It will have very little impact on anyone, if house prices stay at their current levels.

Some mortgages which would otherwise be granted would fall foul of the limits, but the lenders can still lend the money using the 15% they are allowed to use.

So, I expect that they will probably achieve their objective of preventing a housing bubble developing.

If house prices rise but incomes and savings don't, many people will be unable to buy, thus dampening the bubble. If house prices and incomes stay at the present levels, then very few people will be prevented by these regulations from buying their houses.
 
I am delighted that they did not allow Mortgage Indemnity Insurance. That would have not been in the interests of borrowers and would have done nothing to prevent a bubble from happening.
 
There will be quite an amount of people purchasing houses within the central bank rules for their own prudential reasons so their will be quite an amount of money floating around in the "15% banks slush fund". Hope this is lent correctly.
 
If there is no bubble ? Here we go - one of the basics we need is that the Statistics that are being bandied about are 'correct'. My mother said to me sure we were told there were so many ghost estates, empty houses etc that we would not need to build for years and here we are with little buidling activity and the Sage of AAM uses the term '..if there is a bubble.."
Cane we define a bubble?
A starter - if prices rises 23% in a year is this:
(a) evidence of a bubble
(b) no evidence of a bubble
 
WizardDr said:
If there is no bubble ? Here we go - one of the basics we need is that the Statistics that are being bandied about are 'correct'. My mother said to me sure we were told there were so many ghost estates, empty houses etc that we would not need to build for years and here we are with little buidling activity and the Sage of AAM uses the term '..if there is a bubble.."
Click to expand...

No building activity and according to Ivan Yates on Newstalk today there are 2000 fewer properties to rent compared to the same time last year. Not sure where he sourced that information from though.

We cannot speculate on house prices, but it would be interesting to debate what house prices should be if there was a proper market in Dublin where supply was meeting demand.

Can't remember but it was probably RTE at the weekend. That the CB has stated there are x number of houses around 200K in Dublin but the commentators were wondering where were the CB seeing these houses. (I think it was half of Dublin houses sold) Sounds like very cheap houses to me.
 
Bronte said:
No building activity and according to Ivan Yates on Newstalk today there are 2000 fewer properties to rent compared to the same time last year.
Click to expand...

I'm seeing more building activity near us (in Greystones), there's a 50 house estate under construction, a planning notice for a 13 house development, a number of smaller infill developments that have been stalled for years have now restarted and it looks like they're about to start building at the harbour where there is permission for almost 400 units, stalled for years.
 
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