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Index shows first time buyers spend 17% of their net income on their new home

There is a higher afforability level in Dublin due to property prices increasing by up to 12.1 per cent.

HOUSING AFFORDABILITY IS stable nationwide but weakening in Dublin according to the latest EBS and DKM Affordability Index for first time buyers.

The index shows that the national affordability level for first time buyers is 17.3 per cent of net income for a working couple purchasing the average property,with this figure forecasted to rise to 17.7 per cent by the end of this year.

Property prices

However, there is a higher afforability level in Dublin due to property prices in certain areas increasing by up to 12.1 per cent in the six months to September. As a result, affordability levels have weakened reaching 22.4 per cent in September 2013, with the figure expected to rise to 23.7 per cent at the end of this year.

Head of Mortgages for AIB and EBS, Jim O’Keeffe said:

It is clear that property is now at its most affordable level in many years and with house prices increasing in Dublin, there is evidence that consumer confidence is gaining momentum.

€100M fund

AIB and EBS also announced that they are making a fund of €100 million available for customers to support the Government’s new Home Renovations Tax Incentive Scheme.

The scheme is for those seeking to make improvements to their existing home. Customers can either avail of a mortgage top-up or personal loan under this fund. Customers can top up their existing mortgage with a minimum borrowing of €10,000 over a minimum term of five years at the bank’s current home loan rates.

O’Keefe said they welcomed initiatives such as the Home Renovation Tax Incentive Scheme and said to date this year they have already approved more than €60 million in home improvement loans to customers.

This additional €100 million fund will facilitate the increase in demand which the Government scheme will no doubt generate over the coming year, added O’Keefe.

Column: House prices are rising again, so should we be concerned about a bubble?>

Read: Property prices rise again, that’s five months in a row now>

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