Sunday 25 September 2016

Honohan to meet estate agents over lending rules

Published 30/09/2015 | 02:30

Central Bank governor Patrick Honohan
Central Bank governor Patrick Honohan

Central Bank governor Patrick Honohan has called in estate agents to discuss the property market, with the ­impact of lending restrictions on property sales expected to feature prominently.

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It follows a call from Finance Minister Michael Noonan for the Central Bank to review the rules, which he said are preventing first-time buyers from purchasing starter homes.

The rules are also said to be contributing to spiralling rents. This is because younger ­people are unable to get a ­larger deposit together to take out a mortgage and are instead being forced to rent for longer than they expected.

However, others see the rules - which were introduced last February and demand larger deposits for mortgages and put restrictions on the amount that can be borrowed - as acting to put a brake on runaway house price inflation.

Now Mr Honohan is to meet estate agents and economists from leading agencies - including Sherry FitzGerald, CBRE, Lisney and Savills - today, the Irish Independent has learned.

Around 15 people have been invited to the meeting. A number of those invited to attend said the lending rules and their impact on housing supply are set to dominate the discussions.

Another person going to the meeting, who did not want to be named, said there was no set agenda and it was likely to be an information-sharing meeting.

They insisted that the Central Bank occasionally meets estate agents.

However, the meeting comes just two weeks after Mr Noonan called on the Central Bank to examine the impact of the ­mortgage-lending restrictions.

He said the lending caps were contributing to a situation where people were paying more on rents than it would cost for a mortgage.

A Central Bank spokesman for the said it never commented on meetings involving the governor.

Irish Independent

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