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Recapitalisation scheme allows incompetent bankers to target young homebuyers - News - Young Fine Gael

Recapitalisation scheme allows incompetent bankers to target young homebuyers

As house prices fall, FF tries to lure young people into negative equity - to dig-out developers and the banks

Young Fine Gael (YFG) have today expressed their astonishment at the proposal for a 30 percent increase in the number of mortgages being granted to first-time buyers, as part of the scheme to recapitalise AIB and Bank of Ireland.

YFG President Barry Walsh has said: "House prices are falling rapidly. But the reality is that they are still vastly over-priced, and still have a long way to fall. It is simply astonishing that the Government is attempting to lure young buyers into such a dangerous market - particularly when job security has become such an issue for young people, and making mortgage repayments is more difficult than ever.

"In the teeth of a financial crisis which was caused by foolish lending, the Government is trying to encourage MORE foolish lending. This is Fianna Fáil voodoo economics at its worst.

"This is the latest pro-developer policy to come straight out of the back pocket of the Construction Industry Federation, following on from the "Home Choice Loan" ploy announced in the Budget last October. Thankfully, this scam has been a miserable failure, with only four such loans granted to date by local authorities, as the Housing Minister Michael Finneran was forced to admit recently. (See attached Parliamentary Question).

"At a time when negative equity is a reality for many homeowners, it is incredible that the Government is proposing developer-friendly measures which would entice even more young people into taking such a risk. Only a significant drop in house prices by developers, together with emergency Government measures to strengthen job security, can help young and first-time buyers - not Government bailouts for bankers and developers.

"This proposal shows that Fianna Fáil are still proud to be the political wing of the Construction Industry Federation."

For ORAL answer on Thursday, 5th February, 2009.

Ref Nos: 3895/09 and 4076/09

Minister of State at the Department of the Environment, Heritage and Local Government (Mr. M. Finneran):

I propose to take Question Nos. 50 and 221 together.

The Housing (Home Choice Loan) Regulations 2008, which provide for the introduction of the Home Choice Loan scheme came into effect on 1 January 2009. The scheme is now fully operational.

Over 1,200 prospective purchasers had formally registered interest on the dedicated Home Choice website ( in advance of the scheme's formal introduction on 1 January and these have been contacted in recent weeks to advise that applications are now being accepted. 4 full applications have now been made and a significant number of enquiries have also been received from brokers in relation to pending applications.

It is important to note that the intention of the scheme is not to provide an incentive for households to enter the housing market; it is designed rather to facilitate first-time buyers who have decided to purchase a home at this time.



Barry Walsh
President Young Fine Gael
087 6402497

Susie O'Connor
National Youth Officer
086 66 22 819

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