I'm not arguing that financial regulation doesn't have a role, but that interest rates have an even greater role.  The affordability of mortgages has been damaged more by people losing jobs and large parts of their income rather than the relatively minor interest rate increases to date.  Interest rates also effect perceptions of value.  If can get a mortgage for a house for the same price as I can rent one, why wouldn't I get the mortgage and end up owning the house in the end.

Yes, at the margins there were problems with 100% mortgages and people getting mortgages 5 times their combined incomes - and this should have been regulated. But overall mortgage demand wouldn't have been anything like it was had interest rates been higher.

If interest rates are as irrelevant as you claim, why is it virtually the only policy tool the ECB actually uses on an ongoing basis?

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