The Central Bank has published its 2017 Review of Residential Mortgage Lending Requirements, and announced that it will be making very minor changes to its Residential Mortgage Regulations from 1 January 2018.

The key aspects of the Residential Mortgage Regulations will remain the same, but separate loan-to-income allowances will be introduced for first-time buyers, and for second-time buyers.


The Central Bank's Residential Mortgage Regulations were first published in 2016, and the Central Bank committed to reviewing those Regulations annually.

Last year, the Central Bank introduced a number of changes to the Regulations which took effect on 1 January 2017. For further information on last year's changes, read our November 2016 briefing: Central Bank Mortgage Regulations: Results of review announced.


The 2017 Review notes that the risk profile of new mortgage lending has broadly developed in line with market developments over the last year. As a result, the loan-to-value (LTV) and loanto- income (LTI) limits are not being changed. However, the LTI allowances are being refined to differentiate between first-time buyers (FTBs) and secondtime and subsequent buyers (SSBs).

The table on the following page summarises the changes which will come into force on 1 January 2018.

The valuation provisions are also being refined. When calculating the value of collateral for a loan issued for construction purposes, the lender must take the lower of (a) the estimated market value of the property after the works are completed and (b) the site cost plus the cost of works (estimated at the time that the mortgage loan is entered into).

FTBs Cap: 90%
Minimum deposit: 10%
No change
SSBs Cap: 80%
Minimum deposit: 20%
No change
Buy-to-Let (BTL) Cap: 70% No change
Exemptions Negative equity mortgage loans Refinancing/switcher mortgages
Alternative repayment arrangements (ARAs)
No change
Lending Caps FTBs: Up to 5% of new lending can exceed 90% cap SSBs: Up to 20% of new lending can exceed 80% cap BTLs: Up to 10% of new lending can exceed 70% cap No change
FTBs Ceiling: 3.5 x borrower's income No change
SSBs (incl. negative
Ceiling: 3.5 x borrower's income No change
Exemptions BTL investors Refinancing/switcher mortgages ARAs No change
Lending Caps FTBs: Up to 20% of new lending for can exceed the cap SSBs: Up to 20% of new lending for can exceed the cap FTBs: No change
SSBs: Up to 10% of new lending can exceed cap

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.