errlloyd wrote: » I think this is also an admission by AIB they're expecting a widespread price drop. No point on allowing someone to borrow against a home you think will crash in price.
Billythekid19 wrote: » My point is that Joe Bloggs applying for a modest 200k mortgage this year has the same chance of losing his job as Billy Big Bollocks that drew down a 500k mortgage last year.
guyfawkes5 wrote: » If banks do tighten lending criteria significantly (I don't consider checks for the Covid-19 subsidy to be overly tight criteria), then this would push houses prices down very sharply. You'd then have a similar rebound in a year or two once the rules are loosened back up, as there would be a glut of people restrained from buying entering the market at the same time. I would hope if it looks like this is going to happen, the government intervenes to prevent another boom and bust housing cycle as it really is unique to Ireland and would exacerbate a lot of social problems we have if we create another 'lost generation' looking for their first house.
awec wrote: » It's an admission that they think there'll be people who can't afford to pay mortgages. Borrowing against a property that falls in value by itself is not much of an issue once the mortgage is still serviced. .
Claw Hammer wrote: » Therein lies the problem. people are in positive equity have a much greater incentive to hold on to the property. People in negative equity tend to take the view that it is better to keep their money rather than pouring it into a loss. If they are repossessed they will get nothing other than a lower debt. People in positive equity will get the equity back if they have to sell and won't want to lose any of it in legal costs if there is a forced sale.
awec wrote: » If prices do fall significantly there will be a lot of people watching from the sidelines as the housing market remains out of reach for them as they do not fit the risk profile the banks are looking for.
GreeBo wrote: » Doesn't that just push those people towards cheaper houses, increasing demand for those houses and thus increasing the price?
awec wrote: » No it pushes those people into the rental market.
fliball123 wrote: » Would they not already be there anyway?
Springy Turf wrote: » Yes, but people who previously would have been leaving the rental market will have to stay.
combat14 wrote: » https://amp.independent.ie/business/personal-finance/lenders-stop-issuing-mortgages-to-customers-on-pandemic-unemployment-payment-39324345.html sounds like all lenders are now taking the same line as AIB
MrMusician18 wrote: » Market is now effectively shut for at least half of potential purchasers.
Underground wrote: » I found it interesting how the media was framing the AIB story today i.e. a "frightening tightening" of measures. I would have thought introducing an outright ban on mortgage lending to people in receipt of the covid payment or even on the WSS was an act of prudence, and don't we want our state owned bank to be prudent?
richard D wrote: » This can only mean one thing a lack of lending, which will result in lower competition for houses, and ultimately lower prices. I'm flabbergasted at how people can argue on this thread that house price are going up because of pent up demand from Covid 19 savings, house prices go up due to lack of supply. Its utter nonsense. We know that we are in a recession all the forecasters, IMF, Central Bank, Irish Government etc are all forecasting a contraction in the economy by up to 12% and maybe some recovery in 2021. All have forecasted a downward projection on house prices. All the models used have factored in all the variables such as a) Shortage of supply due to construction ceasing,b) additional savings accumulated during the lock-down etc. Do you think its wise to trust someone opinion Mr Joe Bloggs on this site who has ulterior motives to begin with (a) either bought a hose recently b) looking to buy before there exemption is pulled) who wants to convince themselves that house prices will go up due to xxxx, so they feel,like they have made/will make the right decision. Can people accept that fact that house prices will fall. Instead of trying to make themselves feel better if they have bought recently or are looking to buy. The only questions is how much will prices fall, 5%? 10%? 15%? or 20%+, that should be the focus of this discussion.
a generation of homeowners was plunged into arrears by the financial crash and the reckless lending practices of institutions which had allowed borrowers to become overextended
taxpayers were forced to pump €64 billion into the State’s banks to keep them afloat after years of reckless lending
The main cause of the Irish crisis was clearly the wave of reckless bank lending which preceded it
cnocbui wrote: » If four people are interested in a house, and one of them gets bumped from contention because of loan requirements, that still leaves 3 in competition to buy so in all likelihood, the price won't drop. As we have already seen anecdotally, if prices do drop, or if there is even just a suspicion they might, many sellers will just withdraw from the market or not enter it to begin with, further restricting supply.
MrMusician18 wrote: » The only people that will qualify for full mortgages are couples in the public service and tech. How many people do you think that is?
liam7831 wrote: » This has been happening with the last month or 6 weeks, as I just got mortgage approval updated but it's only based on one of our wages as other person on C19 supplement. I suppose people not in system for the last few months didn't realize this
schmittel wrote: » The fact that banks restrict lending to people whose salaries are subsidised/replaced by government handouts should not really come as a big surprise to anybody.
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