Monday 24 September 2018

Nearly half of all city council mortgages are now in arrears


Lord Mayor Christy Burke
Lord Mayor Christy Burke

DUBLIN city council is owed €15m in mortgage arrears prompting a call for people to be moved onto the mortgage-to-rent scheme.

At the moment the council has 2,588 mortgages on its books and almost half of them (46pc) are in arrears.

The total arrears due has increased ten-fold since 2007 and medium-to-long-term arrears are "clearly a significant problem", according to Dublin City Council (DCC) officials.

Of those in arrears, 605 households have been missing mortgage payments to the council for more than a year, with €12,000 being the average arrears amount.

At the end of last year 251 houses were considered unsustainable and 154 were being assessed for the mortgage-to-rent scheme.

This year, the council will repossess 25 houses; 12 of these properties have already been abandoned by debtors.

DCC has so far repossessed 109 houses, driving two households into the homelessness services.

Properties that were repossessed by the council are located across the city with the majority located in Dublin 10 and 11.

Lord Mayor Christy Burke has warned that many more families could end up in hotels and bed and breakfasts if a more sustainable solution is not found.


The city's first citizen said that he would be asking the council to introduce a fast track system to get people in arrears onto a mortgage-to-rent scheme.

"It will give people not only the chance to stay in their homes but also to be able to breathe at the end of the day," he told the Herald.

"These are not people who won't pay but rather people who can't.

"Every effort must be made to avoid further repossessions."

DCC became a mortgage lender under government schemes, including the affordable housing scheme and the shared ownership system.

However, the council has now been advised to consider discontinuing its lending facilities in the future due to the high level of those falling behind on payments.

Government policy dictates that all local authorities must act as a lender if people are refused by two financial institutions.

Mr Burke said that during the Celtic tiger the council became "the lender of last resort" and it is vital that it avoids falling into a similar trap of excessive lending again.


The majority of those who availed of council mortgages were single income households and the most common reason for people falling behind on payments was being made redundant, he added.

Apartments were the most common property types bought using DCC mortgages.

A full report into the issue is due to be published soon and people who are in arrears have been interviewed as part of it.

One person who spoke with researchers said that if they had been refused a mortgage 10 years ago they would have been "devestated" but, in light of their current circumstances, they feel the council would have been doing them a favour.

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