Noonan: we will not repeat property mistakes

Minister for Finance Michael Noonan has insisted the Government will not "travel blind" with as it examines a contentious new initiative to intervene in the mortgage market.

Although he said the idea was worth exploring, he stressed the major emphasis in any such plan would be to increase the supply of houses

At a press conference this morning on new legislation to transfer €6.8 billion to the State’s new strategic investment fund from the national pension reserve fund, Mr Noonan also said Budget Day will be on October 14th or 15th.

While he aims to appoint a successor to outgoing Department of Finance secretary general John Moran by mid-July in good time for Budget 2015, the Minister declined to say whether he had a preference to appoint a permanent civil servant to the post or someone from outside the system.

Mr Noonan made it clear that the Government will carry out a comprehensive economic impact analysis before deciding whether to move ahead with scheme to guarantee a small portion of mortgages taken out by first-time buyers of new homes.

While a British mortgage insurance scheme worked well outside London, he acknowledged that the initiative had created problems in the London market.

“We have a very serious supply side problem. We’ve got a lot of young people in apartments, a lot of young people in rented accommodation, first baby, second baby, they now need a house and the supply isn’t there,” he said.

"If you look at the mortgage guarantee schemes then, introduced in England, successful outside of London, ran into difficulties in London, so we're not travelling blind, we can see what's happening there."