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 Post subject: Govt's New Affordable Mortgage Scheme
PostPosted: Mon Jan 22, 2018 9:22 am 
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Too Big to Fail

Joined: Aug 8, 2008
Posts: 3530
Location: Cathair na dTreabh
Government sets floor for house prices. Déjà vu :x
through the Affordable Mortgage Scheme
Provides state mortgages @2.25% for 30years.
Did Eoghan watch that NZ documentary on the Pin? :)

In Greater Dublin, Cork and Galway, the maximum market value floor is €320k.
In the rest of the country, it is €250k.


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 9:34 am 
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Neo Landlord

Joined: Sep 9, 2017
Posts: 281
Income limits of €50k for individual, €75k per couple will disqualify quite a few in Dublin, not much help in South Dublin anyway.

So Fine Gael are in the Mortgage market now. Won't help with privitising the Mortgage lenders we already have.


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 10:07 am 
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Too Big to Fail

Joined: Aug 8, 2008
Posts: 3530
Location: Cathair na dTreabh
Mortgage shop opens on 1 February
http://rebuildingirelandhomeloan.ie/

It looks like an extension of the homechoiceloan scheme, except with higher income limits (HCL €35k, €45k joint), lower cost of borrowing (HCL 3.30%)

I can see estate agents nationwide opening frothing bottles of bubbly.


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 10:55 am 
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Of Systemic Importance

Joined: Sep 13, 2012
Posts: 5247
temene wrote:
Government sets floor for house prices. Déjà vu :x
through the Affordable Mortgage Scheme
Provides state mortgages @2.25% for 30years.
Did Eoghan watch that NZ documentary on the Pin? :)

In Greater Dublin, Cork and Galway, the maximum market value floor is €320k.
In the rest of the country, it is €250k.


"House hunters looking to avail of the deal must also have had two insufficient offers or refusals for a mortgage from two lending institutions."

So basically you have people who are bad risks being offered lower rates of interest than good risks. XX

I would love to hear a finance/economics take on this one.

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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:01 am 
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Property Magnate

Joined: Mar 30, 2016
Posts: 661
temene wrote:
Government sets floor for house prices. Déjà vu :x
through the Affordable Mortgage Scheme
Provides state mortgages @2.25% for 30years.
Did Eoghan watch that NZ documentary on the Pin? :)

In Greater Dublin, Cork and Galway, the maximum market value floor is €320k.
In the rest of the country, it is €250k.


so a fixed term 2.25% mortgage over 30 years is now the reward for the cohort who enjoy a very low effective tax rate. A couple on a joint income of less than 75k. Effective rate of tax on a couple earning 74k is 19% v 35% paid by a couple earning double that.

perfect XX


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:10 am 
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Under CAB Investigation

Joined: Jan 2, 2008
Posts: 1586
While the higher interest rate on poor credit holders is logical. It's also logical that it increases likelihood of default. Bit of a vicious circle.

I am more aggrieved with a 25yr fixed at 2% at just under 4 times earnings. So, the government have managed to goose the low end of the market up to 250K & 320K around the country. And goose the middle up to 500K with FTB. Can you qualify for both FTB grant and this new scheme? I see nowhere saying you can't.

If you think about government interventions and their impacts (over decades), it's easy to feel physically sick.

Needs its own thread really.

I'm off to think about how I can get a 250K mansion in Cavan on one earning while one of us gets the dole. It's probably not that hard.

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The pigeon just knocks all the pieces over.
Then shits all over the board.
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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:15 am 
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Of Systemic Importance

Joined: Sep 13, 2012
Posts: 5247
Karl Deeter (I think) ripping into in on Pat Kenny's Newstalk programme.

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"It's easy to confuse what is with what ought to be, especially when what is has worked out in your favour"
Tyrion Lannister


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:17 am 
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Under CAB Investigation

Joined: Jan 2, 2008
Posts: 1586
Cavan here I come!

http://www.daft.ie/cavan/houses-for-sal ... n-1053987/

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“Never play chess with a pigeon.
The pigeon just knocks all the pieces over.
Then shits all over the board.
Then struts around like it won.”


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:25 am 
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Under CAB Investigation

Joined: Jan 2, 2008
Posts: 1586
ixus wrote:


Actually, I'm off to Leitrim. Needs a bit of TLC but reckon there are enough rooms there to rent out and get €14,000 per annum back to cover mortgage.

€225K morgage @ 2% = 953pm v 1,166pm rent a room. Government be actually paying me 200pm. Plus I'll try and get onthe social. This could work nicely.

http://www.daft.ie/leitrim/houses-for-s ... m-1598785/

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“Never play chess with a pigeon.
The pigeon just knocks all the pieces over.
Then shits all over the board.
Then struts around like it won.”


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:53 am 
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Real Estate Developer

Joined: Jun 10, 2010
Posts: 889
Is it seriously fixed rate for 25 years?
What happens if inflation takes of and the ecb raises rates (aggresively)?
The average hard worker will get nailed with higher taxes to offset the losses being made on low fixed rates (unless government borrows long term fixed), also the more borrowing the more expensive it is anyway. It's socialised either way.
And the commercial banks should be administrating the process if it goes ahead.

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Last edited by conork on Mon Jan 22, 2018 11:58 am, edited 1 time in total.

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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 11:57 am 
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Of Systemic Importance

Joined: Sep 13, 2012
Posts: 5247
Well, if the govt is directly financing it then the maturities could be matched with govt bonds.

But then who needs capitalism, right? Just have the govt. issue mortgages for everyone and hope they repay. Be grand.

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"It's easy to confuse what is with what ought to be, especially when what is has worked out in your favour"
Tyrion Lannister


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 12:09 pm 
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Of Systemic Importance

Joined: Nov 4, 2011
Posts: 5960
Location: SthDub
This is f-n insanity. Pushing house prices higher ....more carrots for builders. Never the stick for them boys.


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 12:09 pm 
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Holiday Home Owner

Joined: Jun 28, 2010
Posts: 320
For comparison- The Income threshold for eligibility for a 2 adult/2 child household for Social Housing Support from a GDA local authority is €38K net. 'Trickle down' housing initiative for sure.


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 12:34 pm 
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Under CAB Investigation

Joined: Jan 2, 2008
Posts: 1586
Can we not all just get govt backed Mortgage Protection Insurance bringing rates down to 2% for 25yr mortgages?

Government (the people) are effectively taking 40/50% of the underlying risk (60% LTV with UB is 2.95% best rate), 25yr interest rate risk and givng at least a 1% spread on rates with banks. Who will be issuing the mortgages? Banks, pensions, ntma?

Is this preempting banks lowering rates?

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“Never play chess with a pigeon.
The pigeon just knocks all the pieces over.
Then shits all over the board.
Then struts around like it won.”


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 Post subject: Re: Grappling with the housing crisis: Fresh approaches need
PostPosted: Mon Jan 22, 2018 12:40 pm 
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Of Systemic Importance

Joined: Sep 13, 2012
Posts: 5247
ixus wrote:
Can we not all just get govt backed Mortgage Protection Insurance bringing rates down to 2% for 25yr mortgages?

That would require the govt to immediately start paying the mortgages of all the current defaulters, removing any requirement of the banks to chase them for payment.

There's a lot of guff talked about moral hazard but in this case it's ringing off the hook.

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"It's easy to confuse what is with what ought to be, especially when what is has worked out in your favour"
Tyrion Lannister


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