Michael Finneran (Roscommon-South Leitrim, Fianna Fail)

The Deputy has asked a number of questions. The new home choice loan cannot be construed in any way to be entering the sub-prime area. This is a targeted approach for first-time buyers and there is no incentive. It aims to deal with people who would have been able to get a loan in the past. It is well known nationally that a person looking for a €300,000 mortgage, with financial institutions looking for 20 % as a deposit, would require €60,000. We all know that is not feasible for young people today. Our target is those who have already decided they want to buy a home, who have the necessary income to make repayments on a mortgage but do not have a €60,000 deposit. We are facilitating a 92% loan to value mortgage.

As to why we did not include second-hand houses, research indicates that over 70% of first-time buyers purchase new houses. Information also indicates a differential of approximately 14% between the purchase of a new and second-hand house. For that reason we have targeted new homes.

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