Tuesday 17 July 2018

Help-to-Buy is 'a mad idea' - former Central Bank official

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Ronald Quinlan

Ronald Quinlan

The former deputy governor of the Central Bank has described the Help-to-Buy scheme for prospective homeowners as "a mad idea".

Stefan Gerlach left the financial regulator two years ago, and now works at EFG Bank in Zurich. He made the remark in response to a tweet from veteran London-based journalist Russell Findlay.

Referring to the impact of Help-to-Buy on residential property markets, Mr Findlay wrote: "By boosting demand, Help-to-Buy benefits home builders, not buyers, sustaining a [price] bubble."

Responding, Mr Gerlach said: "Yes, of course. A mad idea, but one that sounds great if you don't think about the economics. The Irish government likes/liked it too!"

While those remarks may cause some discomfort for Mr Gerlach's former employers at the Central Bank, they won't necessarily be frowned upon by Housing Minister Eoghan Murphy, who is known to have reservations about the Help-to-Buy scheme.

Upon taking office last June, the new minister commissioned consultancy firm Indecon to conduct an independent review of the scheme over concerns it was contributing to rampant house-price rises.

Irish Independent

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