Mortgage reforms, surprise rate hikes harm renters – ECB study
Researchers say young people could lose equivalent of 1% of their lifetime consumption
Macro-prudential reforms and rises in real interest rates lead to higher rents and lower levels of homeownership, European Central Bank (ECB) research finds.
The study finds that when Ireland’s regulators put a limit on loan-to-value and loan-to-income ratios in 2015, this immediately increased the rent-to-house-price ratio by 2.79%. It also reduced homeownership rates by 1.8 percentage points over the long term and increased wealth concentration.
Authors Gonzalo Paz-Pardo, Juan Castellanos and
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