Value of mortgage approvals hits record €1.28bn in July

First-time buyers accounted for 55% of the mortgages approved in that month

The value of mortgage approvals in the Republic hit a record level of €1.28 billion in July as pandemic-related factors, such as increased savings, enticed more homebuyers into the market.

Figures from the Banking and Payments Federation Ireland (BPFI) show a total of 5,033 mortgages were approved in July.

In value terms, this equated to €1.28 billion, which was higher than any month since 2011, the year the BPFI began collecting the data.

It was also up nearly 60 per cent on last year, albeit activity in the market in July 2020 was very low as a result of the initial lockdown.

The figures show first-time buyers (FTBs) were approved for 2,766 mortgages, equating to 55 per cent of the total, while mover purchasers accounted for 1,272 (25 per cent).

"The latest mortgage approvals for July show continued growth, especially for FTB mortgages," BPFI chief executive Brian Hayes said.

“Looking at the annualised figures which allows us to more accurately assess emerging key trends, there were 53,511 mortgage approvals in the 12 months ending July 2021, valued at almost €13.2 billion – again, the highest level since the data series began,” he said.

“ The value of approvals more than doubled since the 12 months ending October 2016, driven by growth in lending to FTBs and remortgages or switching. These are significant figures and very much signal a robust pipeline for drawdown activity later in the year.”

Activity in the property market has accelerated with the onset of Covid. The current uptick in prices is being driven by Covid-related factors such as increased savings; the return of expatriates; and “right-sizing” .

There are also significantly fewer homes being put up for sale.

The latest official price figures from the Central Statistics Office (CSO) put the annual rate of growth at 6.9 per cent in June, the highest level for 2½ years.

However, several experts said this level of inflation will rise further before falling back next year.