(Bloomberg) -- Ireland's central bank opted to stand pat on mortgage limits, ignoring pleas from bankers and politicians to allow home buyers borrow more.
On Wednesday in Dublin, the regulator decided to leave its rules, including restricting loans to 3.5 times income and requiring large deposits, unchanged.
The “measures are working,” central bank Governor Gabriel Makhlouf told reporters in Dublin.
Pressure to ease the rules has come from Prime Minister Leo Varadkar and financial figures including AIB Group Plc CEO Colin Hunt, who say it stops younger people getting on the property ladder. Mindful of the real-estate crash that devastated the economy in 2008, the central bank opted to resist the pressure to act.
In his first major speech since taking over at the bank in September, Makhlouf called the rules “a permanent feature of the mortgage market,” while deputy governor Sharon Donnery last month said the rules prevent households taking on “excessive” debt.
“I have seen no evidence that more debt for young couples and families is the answer to the current challenges in the housing market,” Donnery said.
Makhlouf also said he had asked staff to do a “deep dive” into international property funds operating out of Dublin, to try to shine a light on what's happening in the sector and any risks it may present.
To contact the reporters on this story: Peter Flanagan in Dublin at pflanagan23@bloomberg.net;Dara Doyle in Dublin at ddoyle1@bloomberg.net
To contact the editors responsible for this story: Ambereen Choudhury at achoudhury@bloomberg.net, Marion Dakers, Patrick Henry
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