Consumers seeking home loans now have 66pc less choice
THE contraction in the lending market means there are just 123 mortgage products available to home buyers, down by two-thirds since the property market collapsed.
Bank closures, the withdrawal of tracker mortgages for new customers and the suspension of fixed-rate home loans by some lenders means that choice has narrowed for first-time buyers, a survey by personal finance website MoneyCoach.ie shows.
Frank Conway of MoneyCoach said lenders were set to restrict their range of mortgage products further.
"In little over three years, the range of products available to consumers has fallen by 66pc, from 358 in the spring of 2008 to just 123," he said.
"The decline in product offerings is expected to fall further with the impending merger of several brands under the bank recapitalisation."
The fall in product range has been mirrored in the drop in the number of active lenders operating in the Irish mortgage market, with several brands disappearing from the landscape altogether.
They include First Active (which was incorporated into Ulster Bank), Bank of Scotland/Halifax and Irish Nationwide, which has been ordered by the Government to stop issuing mortgages.
Leeds Building Society also stopped issuing mortgages here, Mr Conway said.
A number of surviving mortgage brands are set to be merged or sold off, including EBS Building Society, which is to be merged with AIB, and ICS, which is part of the Bank of Ireland group but has been put up for sale.
Fixed-rate mortgages continue to be made available, although several lenders have curtailed their offers.
Lenders that continue to offer fixed-rate mortgages include Bank of Ireland, AIB, Ulster Bank, National Irish Bank, ICS, Permanent TSB and KBC Bank.
"Availing of a fixed-rate mortgage is still possible, but qualifying for one has become much more complex due to the rise in negative equity," Mr Conway said.
He added that many lenders permitted existing customers to switch to a fixed-rate mortgage, but in some situations, deals available to existing customers were inferior than those to new clients.
"Switching from one lender to another can often require up to 50pc equity in one's home, an impossible criteria for many people," said Mr Conway.