A new report has warned that rising property prices could put more homes at risk of repossession.

The warning is contained in a study prepared by the Oireachtas Finance, Public Expenditure and Reform Committee.

The committee said that sustainability should be a key factor in the provision of mortgages and in providing solutions to address householders who find themselves in mortgage arrears.

"The difficulties faced by homeowners who have entered arrears is a matter of national concern," said committee chairman Ciaran Lynch. "In addition to the personal turmoil experienced by both individuals and families, the delay in resolving such difficulties inevitably acts as a 'brake' on wider economic recovery."

“For too long, the mortgage arrears crisis was left to develop. The absence of any mechanism to address this issue inevitably created a ‘state of paralysis’ where both debtors and creditors found themselves in a rapidly deteriorating situation,” he added.

In its report, the committee makes a total of 47 recommendations to address the mortgage arrears issue. These include allowing homeowners to continue to pay their mortgage past retirement age. It said that commencing legal proceedings “should, at all times, be an action of last resort.”

Committee member Stephen Donnelly called on the Government to heed the recommendations outlined in the report.

“The Government’s failure to act decisively means we have turned an economic crisis into a human one. As legislators, we’ve been failing those in debt. We need to urgently change tack, as this report outlines, to engineer the best economic outcome for the country, and not the best financial outcome for the banks,” he said.

"The committee was particularly taken aback by the public refusal of Bank of Ireland to engage in any write-down of secured debt. This is a direct contradiction of stated Government policy in relation to the new insolvency legislation. It is unacceptable that a financial institution that received the support of the state is now openly stymieing our economic recovery in this manner," he added.

“As the report recommends, we need to review and improve the insolvency legislation to stop Bank of Ireland hijacking potential insolvencies. We also need a clear and consistent set of solutions available to borrowers who can never afford to pay off their debts; these include Debt for Equity deals where the bank takes some share of the asset, Split Mortgages and improved mortgage to rent schemes, which aren’t currently fit for purpose.”