Hayes calls for Central Bank to reduce deposit requirement to 15%

Brian Hayes MEP today (Friday) called upon the Central Bank of Ireland to reduce their planned deposit requirement rules for home buyers from 20% to 15%.

“While I welcome efforts to prevent another property bubble, a 20% deposit requirement is just not possible for many people, particularly first-time buyers. 15% would be a much more reasonable rate that makes home ownership achievable for young families and those new to the market,” said Mr. Hayes.

“As well as the 20% requirement, homebuyers will only be able to borrow no more than 3.5 times their annual income – this is much more restrictive than many other countries including the UK, where the loan-to-income ratio is capped  at 4.5 times annual income,” added Mr. Hayes.

“The proposed measures, which would clearly affect first-time buyers disproportionately, need to be revised. Increasing rental prices will make it very difficult for young people to save for a 20% deposit of the value of a home.”

“In Dublin these measures would hit people very hard. The amount of new houses being built in Dublin is dreadfully low and this is leading to steep rise in house prices in recent months.”

“It is important that the housing market is well regulated to withstand any shocks but this should not come at the cost of pushing first-time buyers out of the market,” concluded Mr. Hayes.

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