Tommy Broughan (Dublin Bay North, Independent)
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55. To ask the Minister for Finance his views on the measures the Central Bank should introduce to address access to finance for first-time buyers, in particular those persons who have been renting for significant periods; and if he will make a statement on the matter. [17485/16]

Michael Noonan (Limerick City, Fine Gael)
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The Central Bank, which has an independent mandate to preserve and protect financial stability, introduced mortgage lending regulations 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.  The current regulations, as introduced in February 2015, provide for a lower deposit requirement for first time buyers of a primary home property compared to other residential mortgage borrowers.  For first time buyers, a 90 per cent LTV limit applies on the first €220,000 value of a property and an 80 per cent LTV limit applies on any value of the property thereafter.  For non-first time buyers of a primary home, a flat 80% LTV threshold applies and for buy to let borrowers a 70% LTV threshold applies.  However, lenders also have a certain limited flexibility to, at their discretion, to exceed these thresholds when lending to credit worthy borrowers.

As the Deputy is aware, the new Programme for a Partnership Government (PfPG) provides for a range of measures which seeks to improve the supply of housing and to protect and promote home ownership.  In particular, it states that the Government will work with the Central Bank as part of its review of its mortgage lending limits to develop a new "Help to Buy" scheme to ensure availability of adequate, affordable mortgage finance or mortgage insurance for first time buyers as new housing output comes on stream.  It also indicates that the Government submission to the Central Bank will include a request to consider a "capacity to pay" (e.g. the payment capacity of potential purchasers based on rent paid over a five year period to be off set against the current deposit rules). 

The Central Bank has now commenced this macro prudential review process and my Department will engage with the Central Bank on this.  In addition, as Minister for Finance, I will also need to be consulted in due course on any new revised macro prudential regulations that the Central Bank may decide to be put in place arising from this review.  However, in this process it should also be recognised that the Central Bank has a mandate to promote and protect financial stability and that it has an independence in the formulation of macro prudential measures towards the achievement of that objective.