Mortgage-backed securities to come under stress as house prices decline

IRISH residential mortgage-backed securities are expected to come under severe pressure as house prices continue to plummet.

Yesterday, the Fitch Ratings, in a special report, disclosed that it expects these securities transactions to come under severe stress because their performance deterioration to date is not yet reflecting the house price decline and recent economic stress in Ireland.

“House prices have fallen 31.5% from their peak while Ireland is undergoing one of the deepest recessions of all the advanced economies.