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Macroprudential Measures and Irish Mortgage Lending: An Overview of 2017

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  • Kinghan, Christina

    (Central Bank of Ireland)

  • Lyons, Paul

    (Central Bank of Ireland)

  • Mazza, Elena

    (Central Bank of Ireland)

Abstract

This note provides an overview of residential mortgage lending in Ireland in 2017. It uses data reported to the Central Bank of Ireland as part of the macroprudential mortgage measures. In total, 35,472 loans are covered with a value of e7.4 billion. For first-time buyers (FTBs), the average loan-to-value (LTV) and loan-to-income (LTI) were 79.8 per cent and 3.0 times gross income respectively. Regarding the LTI limit, 18 per cent of the aggregate value of lending to both FTBs and second and subsequent buyers (SSBs) exceeded the limit of 3.5 in 2017. This corresponds to 25 per cent of the value of FTB lending and 10 per cent of the value of SSB lending. Regarding LTV, 17 per cent of the aggregate value of SSB lending in 2017 exceeded the 80 per cent LTV limit. On average, borrowers with an LTI allowance had larger loan sizes and loan terms, were more likely to be based in Dublin and be single compared to those borrowers without an LTI allowance. SSBs with an LTV allowance had larger loan sizes and incomes but lower property values and were younger than those without an LTV allowance.We observe that allowances were allocated to borrowers in all four quarters of 2017.

Suggested Citation

  • Kinghan, Christina & Lyons, Paul & Mazza, Elena, 2018. "Macroprudential Measures and Irish Mortgage Lending: An Overview of 2017," Financial Stability Notes 1/FS/18, Central Bank of Ireland.
    • Handle: RePEc:cbi:fsnote:1/fs/18
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    References listed on IDEAS

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    1. Kinghan, Christina & Lyons, Paul & McCarthy, Yvonne & O'Toole, Conor, 2017. "Macroprudential Measures and Irish Mortgage Lending: An Overview of Lending in 2016," Economic Letters 06/EL/17, Central Bank of Ireland.
    2. Kinghan, Christina & Lyons, Paul & McCarthy, Yvonne, 2017. "Macroprudential Measures and Irish Mortgage Lending: Insights from H1 2017," Economic Letters 13/EL/17, Central Bank of Ireland.
    3. Kinghan, Christina & Lyons, Paul & McCarthy, Yvonne & O'Toole, Conor, 2016. "Macroprudential Measures and Irish Mortgage Lending: Insights from H1 2016," Economic Letters 06/EL/16, Central Bank of Ireland.
    4. Kinghan, Christina & McCarthy, Yvonne & O'Toole, Conor, 2016. "The Effects of Macroprudential Policy on Borrower Leverage," Economic Letters 08/EL/16, Central Bank of Ireland.
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    Cited by:

    1. McQuinn, Kieran & O’Toole, Conor & Allen-Coghlan, Matthew & Coffey, Cathal, 2019. "Quarterly Economic Commentary, Winter 2019," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC, June.
    2. Gaffney, Edward, 2019. "Mortgage borrowers at the loan-to-income limit," Financial Stability Notes 11/FS/19, Central Bank of Ireland.
    3. McQuinn, Kieran & O’Toole, Conor & Allen-Coghlan, Matthew & Coffey, Cathal, 2019. "Quarterly Economic Commentary, Winter 2019," Forecasting Report, Economic and Social Research Institute (ESRI), number QEC.
    4. Allen-Coghlan, Matthew & Judge, Conor & O'Toole, Conor & Slaymaker, Rachel, 2019. "A county level perspective on housing affordability in Ireland," Research Notes RN20190402, Economic and Social Research Institute (ESRI).
    5. Gaffney, Edward, 2018. "Residential property price segments and mortgage finance," Financial Stability Notes 11/FS/18, Central Bank of Ireland.
    6. McQuinn, Kieran & O’Toole, Conor & Slaymaker, Rachel, 2021. "Credit access, macroprudential rules and policy interventions: Lessons for potential first time buyers," Journal of Policy Modeling, Elsevier, vol. 43(5), pages 944-963.
    7. Kelly, Jane & Mazza, Elena, 2019. "Mortgage servicing burdens and LTI caps," Financial Stability Notes 13/FS/19, Central Bank of Ireland.
    8. Lyons, Paul & Nevin, Ciarán & Shaw, Frances, 2019. "Real-estate concentration in the Irish banking system," Financial Stability Notes 4/FS/19, Central Bank of Ireland.

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