Household debt falls to early 2006 levels

Irish household debt continued to fall in the third quarter of 2015, reaching its lowest level since the early months of 2006, new data from the Central Bank has revealed.

The figures showed debt declined to €151.2 billion, or €32,614 per capita, for the three month period, down €2.1 billion or 1.3 per cent overall from the preceding quarter.

This was partly due to continued repayments, write-offs and reclassifications, with repayments at their lowest level since the first quarter of 2010.

As a proportion of disposable income, debt fell 6.5 percentage points to 160.4 per cent, with Ireland joining Denmark as the EU countries that saw the biggest improvement in debt to disposable income ratio in the past year.

Debt has declined from a peak of €203.7 billion recorded in 2008, a fall of almost 26 per cent.

The Central Bank said household net worth rose to €617.6 billion or €133,225 per capita during the third quarter of the year, a rise of 2.9 per cent over the quarter. The increase was fuelled by a rise in housing asset values, with a decline in household liabilities also playing a part.

But a fall in financial assets of €3.4 billion hit household net worth during the period, as the value of equity and insurance technical reserves declined.

Since a low recorded in the second quarter of 2012, overall net worth has risen by 39.1 per cent.