Times: Mortgage rate cap is ‘dead in the water’

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The Times (UK) article on Michael McGrath's bill is here. Free registration required to read.

One well-placed source described the proposal to grant the regulator power to cap interest rates as effectively “dead in the water”, saying: “The minister has said an ex ante economic assessment is needed, on the advice of the attorney-general. The bill will go ahead but without the power to set rates. This bill is essentially dead in the water but the rest will go ahead to committee stage anyway.”
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Critics argue that capping rates could make the Irish market less attractive to new entrants and result in reduced competition in financial services, effectively defeating the purpose of the bill
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Brendan Burgess, founder of the Fair Mortgage Rates campaign, said he hoped interest rates would fall if cashback offers were banned and banks were forced to compete solely on rates.
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Wow...further evidence of the conflict of interest that exists; the State, as the banks' largest shareholder, cannot objectively set rules that impact on the banks' profitability.
 
I always laugh when they say it will 'make the Irish market less attractive and reduce competition'. It's not as if the market is being flooded with new entrants as it is. Or that the current players are going after each other with competitive rates. Some to the SVR by the main banks are an absolute rip off! There is no competition between banks!


Steven
www.bluewaterfp.ie
 
People with mortgages are typically too busy working and child rearing to have time to protest. But alas a major show of force would be the only thing to sway the powers that be.

For right or for wrong, the masses got together and forced water charges out of existence (more burden on tax payer as a result). I fear the rates will stay high because banks + government have no motivation to kill this golden goose.

We all knew of the insurance cartel. Through government intervention, including office raids, insurance costs have magically come back down. One could only imagine what a Russian hacker would find in relation to correspondence in banks/government and the abnormally high mortgage rates
 
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I wonder who the "well-placed" source is?

I personally think it would be a terrible idea to give price fixing powers to the Central Bank but I would take this report with a pinch of salt.
 
Sarenco said:
I wonder who the "well-placed" source is?

I personally think it would be a terrible idea to give price fixing powers to the Central Bank but I would take this report with a pinch of salt.
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Like giving the government power to fix rent increases and not letting the market decide.
 
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