Vol. 259 No. 3
asked the Minister for Local Government if he is aware of a report that a building society is demanding a 3 per cent fee on guaranteed mortgages to builders; that this practice is responsible for increasing the cost of houses; if it is in accordance with the regulations governing building societies; and if he will make a statement on the matter.
73.
asked the Minister for Local Government if he is aware that the funds of building societies are being used for investment property loans; if he will state whether or not this practice is in accordance with the regulations governing building societies; and if he will order an inquiry into the matter.
With the permission of the Ceann Comhairle, I propose to take Questions Nos. 72 and 73 together.
I have seen the newspaper report. The mortgage arrangement to which the report refers is a commercial one between the society and the builders concerned and I have no information as to the effects it may have on the prices of houses. As regards loans by building societies for purposes other than housing, I am aware that in the five years up to 1970, the proportion of total building society advances devoted to purposes other than housing was about 6½ per cent. In the circumstances, I do not consider that an inquiry into this aspect of building society operations would be justified.
The mortgage arrangements referred to in the questions do not appear to conflict with the Building Societies Acts nor do these Acts prohibit a society from making loans for non-housing purposes, provided the loans are secured by freehold or leasehold estate.
