Modelling Credit in the Irish Mortgage Market

Diarmaid Addison-Smyth, Kieran McQuinn and Gerard O' Reilly
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Diarmaid Addison-Smyth: Central Bank and Financial Services Authority of Ireland
Gerard O' Reilly: Central Bank and Financial Services Authority of Ireland
Authors registered in the RePEc Author Service: Gerard Patrick O'Reilly

No 9/RT/09, Research Technical Papers from Central Bank of Ireland

Abstract: The sharp decline in the performance of international property markets has been central to the financial distress experienced globally. The Irish housing market experienced particularly strong rates of price increases and heightened activity levels by OECD standards. One reason cited for such large price increases has been the significant degree of financial liberalisation experienced by Irish credit institutions. The culmination ofmuch of this liberalisation resulted in large increases in the availability of mortgage credit. In this paper we apply a recently developed model of mortgage credit and examine the implications for Irish house prices of changes in lending patterns. Our results suggest that post 2003, a significant amount of the increase in Irish prices was determined by innovative developments in international finance, which enabled Irish institutions, in particular, to secure alternative sources of lending funds.

Pages: 31 pages
Date: 2009-11
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (24)

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Journal Article: Modelling Credit in the Irish Mortgage Market (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:cbi:wpaper:9/rt/09

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