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Government needs to support those facing negative equity – Ó Snodaigh

1 February, 2008

Sinn Féin Housing Spokesperson Aengus Ó Snodaigh TD has called on the Government to put in place initiatives to ease the burden on those likely to face negative equity as a result of falling house prices. Deputy Ó Snodaigh said the Government's failure to intervene when mortgage lenders were giving out irresponsible home loans to those desperate to get on the property ladder during the economic boom has led to a risk of negative equity for those who took out 100% mortgages.

Deputy Ó Snodaigh said, "Figures released today by the Permanent TSB/ESRI house price index show that house prices nationally fell by 7.3 per cent last year. This compares to an average increase of 11.8 per cent in 2006.

"The Government's failure to intervene during the economic boom, when mortgage lenders were giving out irresponsible home loans and as young people were falling over themselves to get on the property ladder, led to many people being sold unsuitable 100 per cent mortgages. Now, with house prices falling, and looking set to continue to fall, many of these people are facing negative equity and could have their homes repossessed.

"Sinn Féin had warned at the time that there would be a slowdown in the market and warned about the consequences of taking out unsuitable mortgages. The Government should have taken stock of our warnings at the time.

"The Government must prepare for such eventualities. The Minister of State with responsibility for Housing must come up with innovative solutions to deal with the plight of those on low and average incomes who find they are facing the repossession of their home." ENDS

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