Mortgage approvals rise above €750m in February

More than €750 million worth of mortgages were approved in February, according to new figures from Banking and Payments Federation Ireland (BPFI), with the lion’s share for first-time buyers.

The BPFI said there were 45,775 mortgage approvals in the 12 months to the end of last month, valued at €10.2 billion, up 0.5 per cent compared with the previous period.

A total of 3,364 mortgages valued at €757 million were approved in February, with first time buyers accounting for 1,693, almost half of total volume, and €391 million in value. Mover purchasers accounted for 931 (27.7 per cent in volume) and €233 million in value.

The figures indicate the number of mortgages approved rose by 10.8 per cent month-on-month and by 7.2 per cent year-on-year.

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“Mortgage approvals in February show a strong uplift in activity both in volume and value compared to the previous month as well as the previous year,” said the organisation’s director of public affairs Felix O’Regan.

Goodbody analyst Dermot O’Leary said mortgage approvals bounced in February after a weak January, reflecting stronger activity in the first-time buyer (FTB) and mover space.

“Coming at a time of of heightened uncertainty around Brexit, this improvement is welcome and consistent with our view that mortgage lending will continue to expand to about €10 billion this year (up 15 per cent),” he said.

An OECD study published on Wednesday, meanwhile, showed that nearly 44 per cent of Irish households owned their properties outright, while 27 per cent owned their homes with the aid of a mortgage.

The rate of home ownership here has been higher in the past. In 1991 it reached a record 80 per cent, one of the highest rates in western Europe.

However, affordability has become a major issue in recent decades, with many workers unable to get on the so-called “property ladder”, resulting in a much largest proportion of the population renting.