Sinn Féin rules out pressuring Central Bank on mortgage rules

Pearse Doherty described the housing situation in Ireland as a "man-made problem", caused by "decisions that were made by successive policymakers".

Sinn Féin spokesperson on Finance Pearse Doherty said: "We’ve had a situation in the past where Government ministers and finance ministers have been called on the Central Bank to do this, that, and the other. We should have learned the lessons from the crash in relation to that." Picture: Gareth Chaney/ Collins Photos

Sinn Féin finance spokesperson Pearse Doherty has said that his party will not seek to interfere with the Central Bank’s rules on mortgage lending should they come to power.

Mr Doherty said that the Central Bank, the financial regulator, has proved in the past that any interference with those rules would have meant that “house prices would have increased further”, causing “more hardship for borrowers”.

“The Central Bank knows its business,” he said. “It knows that there’s a big issue in terms of affordability and that’s where Government needs to focus.”

We’ve had a situation in the past where Government ministers and finance ministers have been called on the Central Bank to do this, that, and the other. We should have learned the lessons from the crash in relation to that.” 

The mortgage rules were introduced in 2015 with the aim of preventing bidding wars for property and stopping people from taking on mortgages beyond their means.

They mandate, with some exceptions, that a person can only borrow to fund a house purchase to 3.5 times their annual income, and that any buyer must have a minimum 10% deposit in order to buy a property.

Mr Doherty, speaking at a talk given to the Institute of International and European Affairs regarding how Sinn Féin views Ireland’s position in the global economy, said that the reality is that “investment is always required in terms of the housing sector”.

“That would be welcome if you had investors that were actually co-financing advanced funding projects here in Ireland,” he said.

He said that the problem with the kind of investment represented by so-called 'cuckoo funds' and institutional investors in the housing market is that “houses won’t ever come on the market because the funds buy them up”.

The fact that one in six renters are renting to a fund is just really, really worrying. We need to take away the tax advantages from the funds.”

Describing the housing situation in Ireland as a “man-made problem”, he said the crisis is down to “decisions that were made by successive policymakers”.

“If you decide to turn off the tap in terms of housing, you will accelerate the price… which I think is an underlying policy of the Government,” he said.

Mr Doherty said that his party’s position is that Ireland’s place “is in the EU, our place is at the heart of the EU”.

However, he said that any foreign investment into Ireland “must also include investment that furthers social development and reduces inequalities”, making specific reference — as he did repeatedly throughout the talk — to housing and childcare.