Young homeowners are most at risk of going into mortgage arrears if the European Central Bank raises interest rates.
That is according to a new ESRI study which found that 18 to 35-year-olds were more likely to be affected.
Households on tracker rate contracts were also considered to be at risk of going into arrears.
The report recommended that lenders should continue to be cautious about approving mortgages in order to protect the market.
Conor O’Toole, ESRI research and author of the report, commented: “The Irish mortgage market has recovered considerably from the crisis and households are better placed to deal with adverse shocks.
Research from the ESRI and @IRLDeptFinance tests how ECB rate rises would affect the ability of households to pay their mortgages. It finds younger, lower income households and those on tracker interest rates would be most affected. https://t.co/53ufCISROb #ESRIpublications pic.twitter.com/LhYhUnz76H— ESRI Dublin (@ESRIDublin) March 12, 2019
"The market is in a much better place now to withstand interest rate rises. However, our research points to vulnerabilities for particular groups of households if interest rates were to rise and inevitably new arrears cases would materialise.
"Younger, lower-income households who are at an earlier stage in their mortgage contract are more at risk, as are households on tracker rate contracts."