Central Bank raises significant concerns with government shared equity loan scheme - Eoin Ó Broin TD
Sinn Féin spokesperson on Housing Eoin Ó Broin has again called for the Minister for Housing Darragh O’Brien to remove the proposed shared equity loan scheme from his Affordable Housing Bill.
The call was made on foot on a submission from the Governor of the Central Bank to the Oireachtas Housing Committee detailing their concerns with the scheme.
Teachta Ó Broin said:
"In their first full public commentary on the government's shared equity loan scheme, the Central Bank has outlined a series of potential risks for families, banks and the housing system arising from the proposal.
"In a letter to the Oireachtas Housing Committee, the Central Bank suggest that, depending on the final details of the scheme, it could be ‘in contradiction’ with the macro prudential lending rules.
"They also highlight the risks to borrowers arising from potentially unsustainable debt, interest charges and unregulated lending.
"The submission also indicates that the scheme ‘could result in upward pressure on house prices’ while having ‘a limited impact on the ultimate supply side problem'.
"Is is also clear from the Central Bank's submission that many of the key details of the scheme have not yet been defined, making any assessment of the scale of risk, impossible at this point.
"In light of this, it would be irresponsible for government to proceed with the scheme at this point.
"Minister for Housing Darragh O’Brien should remove the pro-developer shared equity loan scheme from the Affordable Housing Bill, and allow the Oireachtas to proceed with the affordable cost rental scheme and local authority led affordable purchase scheme.
"When the Minister has finalised his proposed shared equity loan scheme and bodies such as the Central Bank and European Commission have published their final views of the scheme the Minister can return to the Oireachtas with a stand alone Bill.
"This would ensure that the consideration of the scheme by TDs and Senators can be made with all of the information necessary to make an informed judgment."