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Strong growth continues in mortgage drawdown activity but slowdown evident in approvals

31st October 2018

Banking & Payments Federation Ireland (BPFI) has today published the latest figures from the BPFI Mortgage Drawdowns Report for Q3 2018 and Mortgage Approvals Report for September 2018.

The following are the key figures the Mortgage Drawdowns report for Q3 2018:

  • 10,873 new mortgages to the value of €2,369 million were drawn down by borrowers during the third quarter of 2018
  • This represents an increase of 14.4% in volume and 17.5% in value on the corresponding third quarter of 2017.
  • It also represents an increase of 16.4% in volume and 17.6% in value compared with the previous quarter (Q2 2018).
  • First-time buyers (FTBs) remain the single largest segment by volume (48.3%) and by value (48.7%). Together, FTBs and mover-purchasers accounted for 81.4% of the total value of mortgages drawn down.

The volume and the value of re-mortgage loans (switching) continue to increase: there were 1,420 re-mortgage loans in Q3 2018 to the value of €325 million. This reflects year-on-year growth of 82.8% in volume and 82.2% in value.

The number of mortgages for new properties rose by 19.9% year-on-year to 2,438 in Q3 2018, while the value of those mortgages jumped by 26.4% to €588 million. Secondhand property mortgage volumes grew by 4% to 6,289 and by 5.9% to €1,398 million.

In addition BPFI also published the latest figures from the BPFI Mortgage Approvals Report for September 2018. The following are the key elements:

  • A total of 3,825 mortgages were approved in September 2018 – some 1,782 (46.6% of total volume) were for first-time buyers (FTBs) while mover purchasers accounted for 1,067 (27.9%).
  • The number of mortgages approved rose by 4.5% year-on-year and fell by 8.6% month-on-month.
  • Mortgages approved in September 2018 were valued at €822 million – of which FTBs accounted for €385 million (46.8%) and €271 million (33%) by mover purchasers.
  • The value of mortgage approvals rose by 4.3% year-on-year and fell by 11.6% month-on-month.

Re-mortgage/switching approvals rose on a year-on-year basis – by 51.7% in volume and by 42.1% in value terms.

The annualised volume of mortgage approvals reached 44,805 in the twelve months ending September 2018, marginally (0.3%) higher than the twelve months ending August 2018. The annualised value of approvals also rose by 0.3% to more than €9.9 billion.

Commenting on these latest figures, BPFI’s Director Public Affairs, Felix O’Regan, stated:

The level of mortgage drawdown activity continued the pattern of strong growth through the third quarter of this year.  As has been evident for quite some time, first-time buyers account of the lion’s share of all drawdowns – in excess of 48% in both volume and value terms. 

Mortgage approval activity presents a slightly different picture.  On an annualized basis activity by both volume and value shows an increase of 0.3%.  However, the most recent mortgage approval figures for September show a flatlining in activity.  The consensus among financial analysts is that this is most likely explained by the impact of the Central Bank’s macroprudential measures and by challenges in the housing supply market.  Notwithstanding these factors, BPFI member banks remain fully focused on supporting home ownership at every turn.”

The BPFI Mortgage Drawdowns and Mortgage Approvals reports can be viewed on the BPFI website here.


Note: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland.  Together with its affiliates, the Federation of International Banks in Ireland and the Fintech & Payments Association of Ireland, BPFI has over 70 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.

Contact: Jillian Heffernan, Head of Communications, 087 9016880

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