asked the Minister for the Environment if he has under consideration any measures to reduce the heavy cost of mortgage repayments for first time house purchasers, and if he will consult with the building societies to arrange for an extension of the repayment period.
Ceisteanna—Questions. Oral Answers. - Mortgage Repayments.
22.
While I appreciate the financial burden involved in mortgage repayments at present interest rates, I regret that I am not in a position to take measures to reduce it. I am advised that an extension of the repayment period would have relatively little effect on the mortgagor's repayments, although I understand that in cases of hardship building societies will be prepared to consider agreeing to such a course.
Is the Minister aware that there is a very great hardship at present where mortgages are available because of the heavy cost of repayment? Can he give any solace to such people that he has any contingency plans in preparation? Under the last administration, during a particularly acute period, subsidisation was introduced. I am not advocating any particular remedy, but the Minister cannot say he will do nothing about this very serious situation.
Last week I explained about the 1 per cent subsidy introduced in 1974. The main purpose of that subsidy was to make it more attractive for people to invest in building societies. That was a very good reason at that time because deposits were slackening off. At present that is not the case. With regard to the extension of time for repayment, the effect this would have is minimal even between 20 and 30 years.
That is a suggestion I have seen elsewhere.
(Cavan-Monaghan): What is the present cost of servicing a building society mortgage of £16,000?
That is a separate question.
(Cavan-Monaghan): The Minister may have the information.
I will give the figure for £10,000 over 20 years—£127 per month.
(Cavan-Monaghan): The Minister will agree that there are very few mortgages for £10,000.
For Deputy O'Leary's information the repayments for 30 years would be £120 per month, a difference of £7.
That is not a sum that would be rejected by many of my constituents.
(Cavan-Monaghan): Would the Minister be surprised to learn that to service a mortgage of £16,000 would cost approximately £50 a week? Would he not agree that that is far beyond the capacity of the average young house purchaser?
I agree it is a formidable sum but it is being serviced.
(Cavan-Monaghan): Would he agree that it is an impossible sum?
It is a formidable sum but not impossible.
Would the Minister do something about it?