Central Bank not changing guidelines despite Government disapproval

The Central Bank has said it has no plans to change its mortgage guidelines, despite criticism from two Government Ministers.

Finance Minister Michael Noonan last week asked Central Bank Governor Patrick Honohan to change the deposit guidelines, which force buyers to raise 20% or more of a deposit before being granted a mortgage.

Meanwhile, Environment Minister Alan Kelly said he understood the concerns of young buyers, who are struggling to raise the funds while paying rising rents.

However, the Central Bank’s Chief Economist Gabriel Fagan has said the rules appear to be working and there are no plans for a change of course.

“Property market professionals they have revised down their expectations for house price increases and they sighted the mortgage rules as being a factor,” Mr Fagan said.

“So there does seem to be some tentative evidence there but at present moment in time we are in a state of monitoring the impacts and there is no plan at this point and time to change in any way the rules."