Greater collaboration is needed in seeking system-wide solutions for the deepest levels of distress: One of our research papers today suggests that the income levels of approximately 20% of LTMA borrowers are so low, that they cannot make any repayments whatsoever, once reasonable non-housing living expenses are accounted for.
In contrast, in economies with a history of low and stable inflation, mortgage lending tends to be for long maturities and rental contracts tend to be longer term. Of course, Ireland’s history of inflation is now over. But lending arrangements change slowly. Overall, housing markets and financial stability in Ireland would benefit from borrowers having a wider choice of fixed rate loans.