When Credit Constraints Ease: Who Benefits and How?

Anuj Pratap Singh, Francesco Stradi and Fang Yao
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Anuj Pratap Singh: Central Bank of Ireland
Francesco Stradi: Central Bank of Ireland
Fang Yao: Central Bank of Ireland

No 13/SI/26, Central Bank Staff Insights from Central Bank of Ireland

Abstract: In response to the 2023 recalibration of Loan-to-Income limits first-time buyers increased their mortgage borrowing which resulted in broader market access, with younger and lower-income borrowers improving their ability to purchase a property. There were noticeable differences in the response across regions. In supply-constrained Greater Dublin, middle-income borrowers purchased more expensive homes and reduced consumer borrowing. Elsewhere, borrowers reduced downpayments whilst maintaining unsecured credit access, suggesting less binding constraints. The findings highlight the importance of understanding regional heterogeneous impacts, as regional conditions can shape how changes in national macroprudential policy affect household behaviour.

Date: 2026-09
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