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Central bank purposes new mortgage protection rules

  • 07-10-2014 06:21PM
    #1
    Specialun
    Registered Users, Registered Users 2 Posts: 3,068 ✭✭✭


    Is it just me but is this taking the pi55

    With the rising costs of rent..increased taxes and increased charges couples/families will find it hard to save

    Surely this is punishing the joe soap for banks crazy lending before. I cant see this being a runner

    http://www.rte.ie/news/business/2014/1007/650641-central-bank-mortgages/


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Comments

  • #2
    Generic Dreadhead
    Registered Users, Registered Users 2 Posts: 10,870 ✭✭✭✭Generic Dreadhead


    Boo Banks Boo!


  • #3
    shruikan2553
    Closed Accounts Posts: 6,113 ✭✭✭shruikan2553


    So banks lending everyone **** tons of money is bad and banks being limited on how much they can lend is also bad?


  • #4
    realweirdo
    Closed Accounts Posts: 974 ✭✭✭realweirdo


    It's another case of the middle aged middle class crushing the youth of this country and making everyone suffer for the sins of a few.

    Expecting individuals or couples to come up with 50 grand at least as a deposit for a house is just crazy. And whatever savings they did have will be blown away by this. It will push buying a house out of the reach of the vast majority of people which is probably what the central bank wants. If you are a millionaire great, buy a house, everyone else can p*ss off.

    This will also destroy the slowly coming back construction industry and all those industries that feed off it such as shops which sell furniture and the like. I have a feeling this move could send us back into recession.


  • #5
    Specialun
    Registered Users, Registered Users 2 Posts: 3,068 ✭✭✭Specialun


    shruikan2553 wrote: »
    So banks lending everyone **** tons of money is bad and banks being limited on how much they can lend is also bad?


    Ah can you point out where i send bank lending is bad..i said that the 80% mortgage is tough, espically considering the increased tax's or charges

    Ive no issue with banks being highly regulated, but imo at least make it fair

    Very few rent to buy schemes..big issue with social housing...


  • #6
    Sh1tbag OToole
    Closed Accounts Posts: 3,971 ✭✭✭Sh1tbag OToole


    If they started back on the 100% mortgages people would be complaining too


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  • #7
    Specialun
    Registered Users, Registered Users 2 Posts: 3,068 ✭✭✭Specialun


    Sh1tbag OToole wrote: »
    If they started back on the 100% mortgages people would be complaining too


    Do you not see the issue with the huge gap between 100 and 80

    Lets say the average house is 200k...thats 40k in just the mortgage savings...


  • #8
    [Deleted User]
    Posts: 3,251 ✭✭✭ [Deleted User]


    Sh1tbag OToole wrote: »
    If they started back on the 100% mortgages people would be complaining too

    It's AH. If they sneezed there'd be a thread called "Central Bank sneezing on the pewr, de bastards....."


  • #9
    AnonoBoy
    Closed Accounts Posts: 22,559 ✭✭✭✭AnonoBoy


    Ban mortgages.
























    That's what we call the woman who gives out home loans in my local bank.


  • #10
    realweirdo
    Closed Accounts Posts: 974 ✭✭✭realweirdo


    Sh1tbag OToole wrote: »
    If they started back on the 100% mortgages people would be complaining too

    They would and 100% mortgages should never ever have been allowed. It belonged to our Wild West days.

    But 80% is at the other extreme. Houses are wildly overpriced at the moment and most people, particularly working class will never be able to afford a house with these measures, which of course will have knock on impacts down the line yet to be seen.


  • #11
    bmwguy
    Closed Accounts Posts: 1,992 ✭✭✭bmwguy


    Knee jerk reaction to a mini bubble appearing. However the mini bubble is due to restricted supply. It will serve to decrease demand to let the market settle but why not stimulate the economy with increasing supply at the same time to let market find it's own equilibrium. Not a bad long term policy this 80% rule but in short term it will crush the hopes and dreams of someone that had 8% saved and now only is half way there. But can't please all the people all the time I suppose.


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  • #12
    Sh1tbag OToole
    Closed Accounts Posts: 3,971 ✭✭✭Sh1tbag OToole


    Specialun wrote: »
    Do you not see the issue with the huge gap between 100 and 80

    Lets say the average house is 200k...thats 40k in just the mortgage savings...

    Yea about 20%.. thing about it is yer average brick box that comes with a lifetime right to pay property tax on shouldn't be worth 200k anyway. If the limit was 30% or no mortgages at all and maybe a limit of 1 or 2 houses per person they would be a lot cheaper.

    It is strange the attitude people have here towards houses, in some countries they are just something used for living in that you buy out of necessity or gets handed down through the generations without anyone giving a damn about how much it's worth but here it's like "collect as many as you can so you can drink 15 euro cocktails in the shelbourne and go shopping in new york every weekend"


  • #13
    ffactj
    Registered Users, Registered Users 2 Posts: 102 ✭✭ffactj


    I just posted in another thread that we would never in a million years have got our mortgage if those rules were in place 10 years ago when we bought the house. Its very harsh on FTBs.


  • #14
    Kaizersoze81
    Registered Users, Registered Users 2 Posts: 1,240 ✭✭✭Kaizersoze81


    Thread here


    http://www.boards.ie/vbulletin/showthread.php?t=2057300400


  • #15
    suicide_circus
    Registered Users, Registered Users 2 Posts: 19,801 ✭✭✭✭suicide_circus


    Cant afford rent.......cant get a mortgage.....hmmmm


  • #16
    Senna
    Registered Users, Registered Users 2 Posts: 8,800 ✭✭✭Senna


    Limit lending levels = Cheaper houses
    Cheaper houses = Better for everyone

    I cant believe people are straight already back to "poor youth of this country" cant burden themselves with huge mortgages because of them dam banks.
    Credit levels dictate the market levels not the other way around. The market depends on FTB's and if they cant buy because of lending levels, then prices will drop. Cash buyers, investors, small time buy-to-lets etc might push prices up but that will be temporary, if these conditions are imposed on banks, it will stabilize the house market and keep prices within reach of FTB's.


  • #17
    Balmed Out
    Registered Users, Registered Users 2 Posts: 4,710 ✭✭✭Balmed Out


    kind of think its going to lead a return to the property ladder


  • #18
    MRnotlob606
    Closed Accounts Posts: 3,642 ✭✭✭MRnotlob606


    people complain inexorably for about anything


  • #19
    Specialun
    Registered Users, Registered Users 2 Posts: 3,068 ✭✭✭Specialun


    Senna wrote: »
    Limit lending levels = Cheaper houses
    Cheaper houses = Better for everyone

    I cant believe people are straight already back to "poor youth of this country" cant burden themselves with huge mortgages because of them dam banks.
    Credit levels dictate the market levels not the other way around. The market depends on FTB's and if they cant buy because of lending levels, then prices will drop. Cash buyers, investors, small time buy-to-lets etc might push prices up but that will be temporary, if these conditions are imposed on banks, it will stabilize the house market and keep prices within reach of FTB's.

    What about the incresing number of renters...lets not forget that the rental market has gone up as of late....do you think that the government have any interest in stabalizing the rental market? The more demand for quality houses then the greater the rises in rental costs..i understand that there needs to be protection on FTB's but this imo is too much

    If the governent were able to stabalize the rental market..encourage rent to buy schemes...then this would all be fair but the market is still not mature enough


  • #20
    Menas
    Closed Accounts Posts: 12,318 ✭✭✭✭Menas


    Remember, you need to save 20℅ plus stamp duty plus any moving and renovation and furniture costs. That is a big ask.

    I reckoned it would be 10% and limited to four times joint salary....that would be reasonable IMO.


  • #21
    Sand
    Registered Users, Registered Users 2 Posts: 13,280 ✭✭✭✭Sand


    realweirdo wrote: »
    But 80% is at the other extreme. Houses are wildly overpriced at the moment and most people, particularly working class will never be able to afford a house with these measures, which of course will have knock on impacts down the line yet to be seen.

    Why should banks be allowed to lend sums of money that make it easy to buy wildly overpriced houses? We tried lending loads of money to combat poverty and inequality, it didn't end so well.

    If sellers of houses cant find buyers for their wildly overpriced houses, they'll reduce the price. This control is a step in the right direction as history has demonstrated Irish banks are far too stupid to even carry out basic risk control or bread and butter mortgage lending.

    This is a very, very, very good thing for the average Irish citizen who would otherwise be held to ransom when the banks got into trouble. Again.


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  • #22
    Dr Turk Turkelton
    Registered Users, Registered Users 2, Paid Member Posts: 3,129 ✭✭✭Dr Turk Turkelton


    Sh1tbag OToole wrote: »
    Yea about 20%.. thing about it is yer average brick box that comes with a lifetime right to pay property tax on shouldn't be worth 200k anyway. If the limit was 30% or no mortgages at all and maybe a limit of 1 or 2 houses per person they would be a lot cheaper.

    It is strange the attitude people have here towards houses, in some countries they are just something used for living in that you buy out of necessity or gets handed down through the generations without anyone giving a damn about how much it's worth but here it's like "collect as many as you can so you can drink 15 euro cocktails in the shelbourne and go shopping in new york every weekend"

    Ah the good old days,I for one miss them.


  • #23
    professore
    Closed Accounts Posts: 5,849 ✭✭✭professore


    I predict a big wave of rent to buy schemes.


  • #24
    bigroad
    Registered Users, Registered Users 2 Posts: 4,331 ✭✭✭bigroad


    It keeps the rich richer and the young renting at expensive rates.
    This is geared towards the middle aged fat cat landlords renting their propertys while government build social housing.
    If their was a good pool of social housing and young people could buy a house with a reasonable price/mortgage,then the landlord fat cat would be in trouble.


  • #25
    MonkeyTennis
    Registered Users, Registered Users 2 Posts: 3,095 ✭✭✭MonkeyTennis


    There are PLENTY of people who wish the banks had these rules 7or 8 years ago.


  • #26
    realweirdo
    Closed Accounts Posts: 974 ✭✭✭realweirdo


    Sand wrote: »
    Why should banks be allowed to lend sums of money that make it easy to buy wildly overpriced houses? We tried lending loads of money to combat poverty and inequality, it didn't end so well.

    If sellers of houses cant find buyers for their wildly overpriced houses, they'll reduce the price. This control is a step in the right direction as history has demonstrated Irish banks are far too stupid to even carry out basic risk control or bread and butter mortgage lending.

    This is a very, very, very good thing for the average Irish citizen who would otherwise be held to ransom when the banks got into trouble. Again.

    As I said on another thread, the most likely outcome will be:

    1. A further restriction of supply. Are developers and bankers going to go ahead with new estates when they know that the demand will have collapsed? It would be a huge risk. You yourself admit this will massively drive down demand. Developers and banks have to cover their costs.

    2. As I said elsewhere, most of the 25% in arrears, either one or both wage earners lost their job I would imagine. Arrears go up as unemployment goes up, this is a fact. It doesn't matter if you handed over a 20% deposit and the house cost only 3 times salary. If you lose your job, you are screwed. Likewise most if not all people who handed over 8% mortgage and got 4.5-5 salary ratio probably could pay their mortgage if employed.

    Its a poor knee jerk attempt from the banking sector to tackle banking arrears in this country. Tackling unemployment would be better.


  • #27
    realweirdo
    Closed Accounts Posts: 974 ✭✭✭realweirdo


    Senna wrote: »
    Limit lending levels = Cheaper houses
    Cheaper houses = Better for everyone

    I cant believe people are straight already back to "poor youth of this country" cant burden themselves with huge mortgages because of them dam banks.
    Credit levels dictate the market levels not the other way around. The market depends on FTB's and if they cant buy because of lending levels, then prices will drop. Cash buyers, investors, small time buy-to-lets etc might push prices up but that will be temporary, if these conditions are imposed on banks, it will stabilize the house market and keep prices within reach of FTB's.

    WRONG!!!

    It will attract into the market thousands of greedy buy to let landlords.

    Precisely the group most at risk of mortgage arrears.

    This policy is just a disaster waiting to happen. I am beginnging to ask do we really need an Irish Central Bank?


  • #28
    Fr. Ned
    Closed Accounts Posts: 1,589 ✭✭✭Fr. Ned


    Specialun wrote: »
    Is it just me but is this taking the pi55

    With the rising costs of rent..increased taxes and increased charges couples/families will find it hard to save

    Surely this is punishing the joe soap for banks crazy lending before. I cant see this being a runner

    http://www.rte.ie/news/business/2014/1007/650641-central-bank-mortgages/

    Are banks even lending?
    Why would they bother when all they have to do is cry loud enough and the government will hand them billions.
    Some of those billions are then used to shore up the pension funds of their employees. (AIB being case and point).


  • #29
    dotsman
    Registered Users, Registered Users 2 Posts: 3,636 ✭✭✭dotsman


    Senna wrote: »
    Limit lending levels = Less home owners/more renters
    More renters = Better for those who can afford to purchase investment properties/Worse for those stuck in the renting trap

    Fixed your post. Your understanding of the housing market is as crazy as this policy.


  • #30
    realweirdo
    Closed Accounts Posts: 974 ✭✭✭realweirdo


    MonkeyTennis wrote: »
    There are PLENTY of people who wish the banks had these rules 7or 8 years ago.

    Not really. Our banks were crazy 7 or 8 years ago. 100/110/120% mortgages...6, 7, 8 or even 9 times salary. Forged job references...banks not bothering to check. Solicitiors as property developers, farmers as property developers, teachers as property developers, etc etc...can't afford a mortgage? no problem, have one anyways.

    No-one wants a return to that craziness.

    We are at a happy medium now and the rules have been tightened up. There shouldn't be less than 8% deposit required.

    But the new rules are draconian to say the least.

    We bailed out the banks and this is how they pay us back??


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  • #31
    dotsman
    Registered Users, Registered Users 2 Posts: 3,636 ✭✭✭dotsman


    realweirdo wrote: »
    We bailed out the banks and this is how they pay us back??
    I don't think you understand. We bailed them out and now WE are forcing them to implement these new rules (the Central Bank represents us). The banks themselves don't want these rules (they lose out just as much as the people).


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