Will the Central Bank change the rules for deposit

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sidb

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Hi

Will the central bank lower the deposit to 15% for second time buyers or will the judge the market over the summer then raise or lower depending on how the market Pans out.

Thanks
 
I think that the rules will be relaxed. The politicians want that, and in aggregate so do the public. Whether it's the right or wrong thing to do, the Central Bank will cave in.

I believe that they should be relaxed. 90% LTV was fine for years. Saving 20% is just too onerous in a world where people are paying a fortune towards rent and childcare.

And the current rules are strengthening inequality, because it's getting to the stage where only a certain profile of person can afford to buy in urban areas (e.g. wealthy parents for their kids, returning "immigrants", senior professionals).
 
I have been trying to find the threads where this issue was discussed when the new rules were first proposed. For some reason I cannot find them.

Does anyone know if they have been deleted or could anyone provide a link to those old threads.

Thanks
 
I disagree that the rules are likely to be relaxed. In his recent speech, Lane said the rules could change but that it would take extraordinary evidence to justify it. He's responsible for macro-prudential policy, not for making it easier for people to strap themselves to a giant mortgage.
 
The rules are unlikely to be relaxed. The rules would be fine had we adequate housing - still close to lowest in Europe.
Ireland as usual will deal with every single matter - except the one that would keep the lid on prices - build the number we need.
Just look at Germany - 480 units per 1000 - and low house price inflation over a sustained period.
 
Black_Adder said:
The rules are unlikely to be relaxed. The rules would be fine had we adequate housing - still close to lowest in Europe.
Ireland as usual will deal with every single matter - except the one that would keep the lid on prices - build the number we need.
Just look at Germany - 480 units per 1000 - and low house price inflation over a sustained period.
Click to expand...

How many units per 1000 does Ireland have?
 
Its about 420. The gap is huge.
Ireland's ability to do absolutely nothing perversely solves the negative equity problem and creates the illusion of wealth as we have seen.
The Central Bank would be concerned with decoupling of income to borrowing but wont see the macro issue as something that will willingly take on.
It requires a small statutory committee with a number of decisive people.
All the rest get dragged to the Committee presenting solutions or lose their powers.
We will all be dead before that revolution will start - but it would have spectacular results.
 
Bizarre that we cannot ever build infrastructure in this country. Surely given the perfect storm of problems we had in housing, government should take the lead and get involved in building houses. They could be sold at reasonable prices, would breakeven, would generate employment, calm the economy down. Logic goes out the window when it comes to housing, the Central bank rules are not unreasonable if the supply side was functional.
 
Klaus - all of what you say is true.
Everybody who has a house doesn't see the problem.
If we actually build enough there would not be rampant house price inflation.
Its the one German lesson we should adopt, but you know Europe is good that way - you have to make your own (catastrophic) mistakes.

But there is something wrong when middle class Ireland cannot get any act on anything together and let others take it over. Once you have your house, kids in private education and you are surviving - do you really have any desire to be involved in anything remotely smelling of protest?
 
There is an interesting conference this Friday which includes the following papers:

Theme 2: Housing Markets and Macroprudential Policy

13:25 – 13:45 Gabriel Brunneau (Bank of Canada), “Housing market dynamics and macroprudential policy”

13:45 – 14:05 Kieran McQuinn (Economic and Social Research Institute), “Macroprudential policy in a recovering market: Too much too soon”

14:05 – 14:15 Coffee break

14:15 – 14:35 Christoph Basten (Swiss Financial Supervisory Authority), “Countercyclical capital buffers in Switzerland”

14:35 – 14:55 Angus Foulis (Bank of England), “The role of credit in the US housing boom: Insights from tiered housing data”


The conference is free to attend, but you must register

http://www.irisheconomy.ie/index.php/2016/01/13/conference-on-macroprudential-regulation/
 
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