The Society of Chartered Surveyors Ireland (SCSI) has welcomed the decision by the Central Bank to ease deposit rules for first-time buyers.
Prospective buyers will now only require a deposit worth 10% of the entire value of a property. Rules limiting the amount that first-time buyers can borrow have also been relaxed.
Ronan O’Hara, chairman of the SCSI’s Residential Professional Group said the move would provide much needed assistance to first time buyers, many of whom are struggling to save for a deposit.
“This is a well-considered move by the Central Bank and the focus on first time buyers is welcome, particularly in Dublin and other cities," he said.
"This will give confidence to the market and hopefully will encourage more builders to begin developments.
"The retention of the Loan to Income ratios will hopefully help to curb price increases”.
"Buyers can now focus on buying sooner and in locations where they have family support."
"This is also good news for vendors in the second hand market as first-time buyers are not limited to the new homes sector," he said.
However, the SCSI also pointed out that sourcing the required deposit and mortgage is just one part of the equation and much more needs to be done on the supply side.
O’Hara said the Society had consistently called on the Government to introduce initiatives such as reducing VAT on affordable housing, making public land suitable for housing available and providing finance to builders.
“Home to buy schemes or changing mortgage rules will have little impact overall on the housing crisis because supply is the problem, not demand,” O’Hara concluded.
“Reducing or even eliminating VAT on affordable housing and establishing a Development Finance Agency with expertise in construction lending would ensure the houses that first time buyers so badly need are built in a short time frame. That is what is required.”