Irish Property Market chat II - *read mod note post #1 before posting*

Well as someone stated above, 54% of all renters are subsidised by the state. Do you think the government will stop those subsidies ? I say No. I would actually see them increasing rental subsidies.

Maybe I do, maybe I don't. But why isn't there no lending limit on how much you can get for a car loan or a personal loan that is tied to how much you earn, rather than how much you can afford ?

If car loans was limited, it certainly will have a knock on effect on new car ownership in turn on the second hand market.

I honestly think this is a crazy approach. Turn on the compressor full bore and blow the housing bubble to smithereens. Wait till this recession starts and unemployment goes above 10% in order to tame inflation. Then use the newly created QE which the ECB will do as will every other CB in the world in order to keep the circus going and use that to build new houses as well as lower tax rates for small time landlords.

Because a mortgage is significantly larger than a car loan for the individual and for a longer term.

Also total mortgage lending can directly affect the economy as a whole hence why it is subject to macro-prudential controls.

The Central Bank introduced LTIs and LTVs with the "key objective...to increase the resilience of the banking and household sectors to the property market and to reduce the risk of bank credit and house price spirals from developing in the future..." and "The Central Bank does not wish to regulate or directly control housing prices" [Souce: CB]

Also worth noting LTIs do not apply to buy-to-lets i.e. investors.

But why not. It’s either we believe in the free market or not. We don’t need government agencies micromanaging the lending percentage.

Honestly I don’t see why a couple earning 100K should be limited to 350K, this figure should up to a 1m. If they can afford the repayment.

Do you think paying over 2k/month rent is sustainable?

Couple on 100,000 buy a house for 1m now. Say they are 30 years of age, 35year mortgage bring them to retirement age, a mortgage allowing for 10% deposit of 100,000 which is doubtful they would have would still leave you with a monthly repayment of €2,935 at an interest rate of 1.9% (very low you wouldn't get that with a 10x).

So add in all the extras mortgage protection and insurance you talking easily 3050 a month.

You are crazy think people can afford that on 100,000 even if both of them were on 100,000 each it's still crazy. Add in children school and creche. That mortgage is totally unsustainable. As you will be on a 35 year mortgage imagine what happens when you kids come to 18 and want to go to college. Where do you find more extra cash to pay for that all assuming your financially stable which with the tech sector in line for cuts here is not a good place to be in. There is absolutely no wiggle room.

You are a crazy person.

Your letting yourself down now, if rents go to that I can guarantee you wages wont and therefore it is no longer financially viable to work so their will be a full meltdown (demand destruction). In fact it is borderline that as we speak.

I don't know how you are still justifying the scenario I stated above. It is absolutely nuts, you said rent over 2K was unsustainable but paying a mortgage for 3k is and baring in mind that calculation was based off an exceptionally low green mortgage rate of 1.9% for 4 years, Imagine the balloon mortgage payment it could be when you have to re fix after that 4 years when rates head upwards. I honestly cannot see your argument I fully believe you are deluded no offence.

Anything that the government has done to combat the crisis hasn't worked. Hence I think central bank should back off the LTI. Builders are constantly stating that it is not financially viable to build lot of the times. So let's remove the hurdle and allow people to borrow more.

Are you saying they will sell and not buy something else and instead go into rental market and pay more for accommodation and risk being turfed out at short notice.

The notion that rents are capped at 2% is a joke any new supply coming to the market will have significantly higher rents. People will still be impacted as landlord sellls and their CAP of 2% goes out the window and they will be forced into new properties with much higher rent.

If you borrow and get a mortgage you are probably not going to be very liquid. Perhaps you mean equity - yes - but only on the assumption that prices will stay the same or rise.

Given you keep repeating the same thing with out providing any rationale other than "they can afford it", I can only assume you have no understanding/awareness of what caused the last property crash nor why the lending controls were put in place.