Michael McGrath (Cork South Central, Fianna Fail) | Oireachtas source

I welcome regulation as some rules are absolutely needed. I welcome their introduction. The debate is really about the detail.

The Central Bank has got it right largely for first-time buyers. On the sliding scale a first-time buyer buying a house worth €400,000 will be required to come up with a 15% deposit, which is a lot. In Dublin many properties for first-time buyers will be in that region. However, there is a real issue for non-first-time buyers. It will have an impact on the market and, more importantly, a negative impact on the families affected. They may not be in negative equity but have modest positive equity in their properties. In such cases, the full rules apply concerning a 20% deposit. A couple with young children, for example, living in a duplex apartment or a small home may need to trade up to a house worth €350,000. They may be able to service the larger mortgage on this property but may not have the 20% mortgage deposit, namely, €70,000 cash, after they have sold their existing property. To me, that is very onerous and will result in many people being trapped, but we will see how it works out. I hope I am wrong. It is welcome that the issue will be kept under review because the Central Bank has gone too far on the deposit requirement for non-first-time buyers. I do not have a difficulty with the loan-to-income ratio, as it is a good measure of affordability, which is a more important benchmark to test somebody's capacity to service a mortgage.

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