Why Sinn Féin’s plan to give tax relief to mortgage holders is not a good idea

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Why Sinn Féin’s plan to give tax relief to mortgage holders is not a good idea
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If mortgage interest relief is introduced it should be given to those who need it most: first-time buyers

In contrast, a first-time buyer who took out a €300,000 mortgage a year ago on a fixed rate of 5 per cent will get no help as the amount of interest they have paid has not increased.

It is argued that as we give tax relief to private renters, we should also give it to mortgage holders. This argument does not stand up to scrutiny. Even after the recent mortgage rate increases, it is still much cheaper to pay a mortgage than to pay rent. And the mortgage holders will eventually own their own home.In general, mortgage holders are on higher incomes than renters. We pay renters €500 each in tax credit, yet the proposal is to give up to €1,500 to mortgage holders.

There are two other groups of mortgage holders who need help and support from the Government – those whose mortgages have been sold to vulture funds and those who are struggling with their mortgage repayments. The best way to help customers of vulture funds is to reduce the rate of interest they are being charged. Vulture funds should be required to offer their customers the same rates that the original lender is offering their customers today. If this were done, then no one would lose out by having their mortgage sold to a vulture fund.

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