"No point building houses if mortgage rules are too severe"

The new rules are designed to pre-empt another bubble rather than reacting to recent increases in house prices. But they threaten to stymie lending and thus new building activity. There’s no point in building new housing units if citizens are struggling to get a mortgage.



It’s worth noting that mortgage lending this year will total about €3 billion. At its peak in 2006, total mortgage lending was €39.8 billion. Talk of another bubble is premature.

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The construction industry has expressed fears over the Central Bank's new loan-to-value (LTV) and loan-to-income (LTI) requirements. Strict new mortgage lending measures will play havoc with building at both ends - first by eliminating a huge tranche of buyers and second, by causing banks and private financiers to withdraw promised capital and finance for big schemes.

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