The Governor of the Central Bank has indicated that the challenge faced by lenders in repossessing properties from borrowers who aren't meeting repayments is one reason why more banks aren’t entering the market here.
However, speaking in an interview on Newstalk, Gabriel Makhlouf said security of lending is not the only reason behind reduced competition and high interest rates in the market.
"Certainly the security of lending will be one of the important considerations that new entrants into the market will want to take a very close look at," he said.
But the Central Bank boss would not be drawn on whether or not he thought the law should be changed in this regard to make it easier for lenders to seize properties describing it as a "political question".
"We trade off the importance of security in our housing potentially against making Ireland an attractive place for business to come," he said.
The Governor said mortgage interest rates here are amongst the highest in the eurozone in part because of the legacy of the financial crisis.
He said banks here have levels of mortgage arrears that require them to hold more capital.
But he also said that part of the problem is also that there is not enough competition as well as a shortage of housing.
"At the end of the day we need to build more house, we need to build more apartments and we need to build them at a cost that makes them affordable," he said.
Mr Makhlouf also warned that while the interest rates that the state can borrow at are historically low, it is unlikely that it will remain like that forever.
As a result, he said Ireland’s debt needs to be returned to a more sustainable position in the medium term.
However, he added that we shouldn’t seek to do that too quickly.
On the topic of business interruption insurance claims, Mr Makhlouf said he that following last week’s court ruling in the case taken by four pubs against FBD, he now wants to see cases settled as soon as possible.