Irish home buyers to benefit from new changes to mortgage lending limits

Irish home buyers are set to benefit from new changes to mortgage lending limits. 

The Central Bank has eased lending rules following a comprehensive review of the overall mortgage measures framework currently in place. 

Although it was agreed the current measures strengthened the resilience of borrowers, lenders and the economy overall, the Central Bank decided targeted changes are now appropriate due to higher house prices relative to household incomes. 

No changes are being made to the first-time buyer (FTB) Loan to Value (LTV) rate of 90%, however the Loan to Income (LTI) limit for FTBs is increasing from 3.5 to 5 times income. 

The LTI limit for second and subsequent buyers (SSB) will remain at 3.5 times income, however the LTV limit is being changed from 80% to 90%. 

No changes are being made to the mortgage measures relating to buy-to-let (BTL) lending where a 70% LTV limit will continue to apply. 

The changes to the measures will come into effect on January 1 next year.  

Speaking on the outcome of the Mortgage Measures Framework Review, the Director of Financial Stability, Vasileios Madouros, said, "Our review has re-affirmed the benefits of the measures, through fostering a more sustainable mortgage market. Overall, we judged that a targeted recalibration of the measures was appropriate. This eases some of the costs of the measures, especially for FTBs, without compromising the benefits of the measures." 

More information on the changes is available to view here.