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Honohan hints at relief on 20pc mortgage deposit


Patrick Honohan

Patrick Honohan

Patrick Honohan

The Central Bank's indication that it will allow people to get on the property ladder with deposits of less than 20pc has been welcomed by the property sector.

The bank had caused concern with proposed regulations that would mean that buyers would have to save 20pc of a property price to secure a mortgage, sums beyond the reach of many first-time buyers.

Central Bank Governor Patrick Honohan defended the controversial move during a speech on Saturday but said the rules would not have to apply in all cases and that a separate mortgage insurance scheme being considered by the Government could help buyers.

Under that plan, a bank would still be able to lend a further 10pc of a house price if it takes out insurance. That would allow home buyers to make their purchase with a 10pc deposit, while the bank is better protected against house price falls.

Mr Honohan's remarks were welcomed by Institute of Professional Auctioneers & Valuers (IPAV) chief executive Pat Davitts as "a relief".

Read Andrew Lynch on Page 16