The Irish Central Bank Governor Patrick Honohan has indicated that there could be an easing of the rules that will require mortgage applicants to put down a 20% deposit.

Last month, the Central Bank announced new mortgage rules requiring homebuyers to pay a deposit worth 20% of the value of a property. It also announced that banks will be restricted to lending three-and-a-half times a borrower’s gross income.

The regulations were due to come into effect on 1 January 2015. The Central Bank said it was introducing the new rules to help avoid another property crash in Ireland and dampen the rate of price rises currently experienced in the market.

However, there was political backlash to the proposed new rules and many argued the strict regulations would make it impossible for first-time buyers to get on the property ladder.

Honohan had previously said that the introduction of a mortgage insurance scheme could relieve the problem of the high deposit requirement for first time buyers, outlining the role it could play in enabling some customers to secure higher loan-to-value mortgages.

Mortgage insurance is available in many countries, including the US, Australia, Canada, France and the Netherlands. In principle, it allows a bank to lend 90% of a purchase price to a borrower, the homebuyers put down a 10% deposit and a further 10% of the mortgage is insured by a third party.