Obtain a loan of up to 4x your income

The European Central Bank set a ceiling in 2015, allowing borrowers to take out loans from lenders who wish to lend them up to 3.5x their income. However, the ECB recently declared that as a borrower, you may request 4x your income. The loan-value caps will remain the same as before the change, so first-time buyers will be able to borrow 90% of the property’s value, while second-time buyers will be able to borrow 80% of the property’s value.

One unique suggestion received by the ECB was that borrowers earning less than €60,000 be able to obtain a loan of up to 4.5x their income. After the rate crash, the mainstream banks removed development lending. Thus, smaller builders needed alternative finance providers to realize some projects because the extent of the limits was affecting them. Clients now have their own criteria for obtaining a mortgage due to domestic inflation (which was 8.6 percent in September), rising cost-of-living crises, and rising interest rates on loans.

ICS Mortgages, a non-bank lender, tightens its loan acceptance criteria. So, if you take a loan …

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Some information about Frankfurt in Germany

Frankfurt is the 5th biggest city in Germany, it is in Hessen and more than 750.000 people are living there. Between 2008 and 2018 about 100.000 new people were coming to live in this big city.In Frankfurt there are many banks, the ECB (European Central Bank) and the stock exchange, so this city is considered as financial capital from Germany.

The demand for real estate in Frankfurt is bigger than the offer, so the prices for rental rise. In Frankfurt the prices are one of the highest in whole Germany, just Munich has higher prices.

The current average price per square meter for an apartment in Frankfurt today is 17,87 €/m². To rent a flat or a house you must lock a rental contract. These contracts are usually closed for one or two years. In 2018 for an apartment up to 40 square meters you had to pay about 17,90 €/m² , for up to 80 square meters about 13,10 €/m² and for up to 120 square meters about 13,50 €/m² . But the price for an apartment depends on …

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Mortgage Market Update

The Financial Broker gives readers an overview on currently property prices and mortgage market conditions.

The Central Statistics Office published a report showing price inflation on property had increased 10.7% in the past year up to February. A similar report reveal how the number of newly build housing last year was 14,932 units when estimates denote a demand of up to 50,000 units. These numbers illustrate a problem in the current mortgage market, which this article pinpoints the causes of. The author laments about rising property prices, arguing that many potential home buyers have missed out on the prime time to purchase property, and are currently no long capable of affording the housing of their choice at an acceptable price.

The author attributes the current housing price and rent inflation in Ireland as consequences of a lack of supply in urban areas instead of lax macro-prudential regulations. In fact, she argues that current Central Bank regulations are too restrictive, and thus have prevented demanders from being able to locate and buy affordable housing. While the prudential regulations have lowered the …

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European Debt Crisis Statement

We reaffirm our commitment to the euro and to do whatever is needed to ensure the financial stability of the euro area as a whole and its Member States. We also reaffirm our determination to reinforce convergence, competitiveness and governance in the euro area. Since the beginning of the sovereign debt crisis, important measures have been taken to stabilize the euro area, reform the rules and develop new stabilization tools. The recovery in the euro area is well on track and the euro is based on sound economic fundamentals. But the challenges at hand have shown the need for more far reaching measures.

Today, we agreed on the following measures: Greece

1. We welcome the measures undertaken by the Greek government to stabilize public finances and reform the economy as well as the new package of measures including privatisation recently adopted by the Greek Parliament. These are unprecedented, but necessary, efforts to bring the Greek economy back on a sustainable growth path. We are conscious of the efforts that the adjustment measures entail for the Greek citizens, and are convinced …

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Recent Irish bond yields explained in plain English.

We are not issuing bonds, so the cost of servicing our debt has not magically risen to ‘7%’ because we are not borrowing at that rate, what is happening is all in the secondary market.

What that means: The primary market is when the bond is first issued at par (100) and with a coupon (for instance 3%). When a bond is issued the main concern of a bond buyer is getting your capital back (that par value of 100) and it trumps the yield in terms of importance, so you regularly see people buy debt at very low rates from those most likely to pay it back, Microsoft recently issued a bond at 0.8%!

That is where the Ireland story gets interesting, our bond yield is not 7% because we issued it at that yield or interest rate, it is 7% because people are sacrificing their capital to get out of the trade. That means they don’t believe they will get their money back at the end and …

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Falling euro, friend or foe?

Many critics of the Eurozone are sceptical because they have always raised the fact that countries cannot devalue their currency, think twice would be my response, what is happening with the Euro is a large scale depreciation that means nobody has to leave the zone to get cheaper currency.

There is a race to the bottom happening in my opinion, the Chinese have definitely lead the way thus far with their Yuan manipulation, the only reason the world plays ball with them is due to their manufacturing output of cheap goods (which would be cheap compared to 1st world production costs even if Yuan traded at fair value) which we want and willingly buy.

Then you have the dollar, the US has such massive forward liabilities that the dollar will have no choice but to tank, the UK sterling doesn’t have a great future either, fifty years ago it was worth five dollars now it is at $1.43 – but currency is not absolute, it is relative – and that is why you have to look elsewhere to see what …

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