Irish household debt decreases by €1.1bn in first quarter
Irish households fall to fourth most indebted in the European Union
New figures from the Central Bank show Irish household debt stood at €31,216 per capita in the first three months of the year, the lowest level since the first quarter of 2006. Photograph: Matt Kavanagh
Irish households fell from being the third most indebted in the European Union to the fourth during the first quarter of this year, according to new figures from the Central Bank.
The figures show Irish household debt fell by €1.1 billion to €148.5 billion in the first three months of the year.
This represented a household debt per capita of €31,216, which is the lowest level since the first quarter of 2006.
Household net lending fell to a level of €2.4 billion during the first quarter.
The net worth of households increased by 0.3 per cent to €628.7 billion, mainly driven by a rise in house values, and a decline in household liabilities.
Household net worth has regained two-thirds of the drop that followed the Celtic Tiger’s high-water mark of €718 billion in the second quarter of 2007.
The Central Bank said household debt as a proportion of disposable income now stands at 149.4 per cent, its lowest level since the end of 2004.
Investec said the stock of household liabilities now stands at €148.5 billion, 27 per cent below the all-time high of €203.7 billion reached in the third quarter of 2008. It noted household net worth has increased for 12 successive quarters.
“Notwithstanding external pressures, we expect the Irish economy to continue to turn in some of the strongest growth in the EU both this year and the next, facilitating further improvements in the aggregate balance sheet of Irish households,” said Investec chief economist Philip O’Sullivan.