Mortgage drawdowns hit €10.5bn last year – highest level since financial crash

Overall, 2021 had highest volumes since 2009 and the highest values since 2008

A total of 13,299 new mortgages to the value of €3.3 billion were drawn down during the fourth quarter of 2021

A total of 13,299 new mortgages to the value of €3.3 billion were drawn down during the fourth quarter of 2021

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Some €10.5 billion worth of home loans was drawn down by borrowers in 2021, the highest level since the financial crash more than a decade ago, latest figures from the Banking and Payments Federation Ireland (BPFI) show.

In total, 43,494 mortgages were drawn down in 2021, the highest number since 2009. In value terms, the €10.5 billion figure was the highest since 2008, the BPFI said.

Drawdown volumes rose by 22.1 per cent on the previous year, while values rose by 25.1 per cent.

BPFI chief executive Brian Hayes said the figures highlighted a “particularly strong” year for lending to first-time buyers (FTB). “At a segment level, FTBs continue to drive the growth with FTB volumes at their highest level since 2007 and 14.8 per cent higher than in 2008. By contrast, mover purchase volumes were 48.2 per cent lower than in 2008.

The number of loan approvals hit 53,335 in 2021, up 23.6 per cent on 2020 while the value of those approvals jumped by 30 per cent to €13.4 billion. These are the highest levels recorded since the data series began in 2011, Mr Hayes said.

‘Bolstered’

Looking to the year ahead, Mr Hayes anticipates “a strong pipeline of mortgage approvals which will be further bolstered by the recent operational flexibility announced to the Central Bank’s macroprudential rules”.

“With an increase in housing supply also projected we expect all these factors combined to lead to strong activity in the housing and mortgage markets during 2022,” he said.

There was an increase of 9.4 per cent in the volume and 12.3 per cent in the value of mortgages drawn down in the final quarter of 2021 when compared with the same period a year earlier.

Some 13,299 new mortgages to the value of €3.3 billion were drawn down by borrowers during the fourth quarter. A comparison with the previous quarter shows an increase of 15.9 per cent in volume and 19 per cent in value.

First-time buyers (FTBs) remained the single largest segment by volume (54.4 per cent) and by value (54.2 per cent).

A total of 3,856 mortgages were approved in December 2021 – some 2,096 were for FTBs (54.4 per cent) while mover purchasers accounted for 891 (23.1 per cent).

The number of mortgages approved in December fell by 22.2 per cent month-on-month and by 3.6 per cent year-on-year.

Mortgages approved in December were valued at €1 billion – of which FTBs accounted for €550 million (54.4 per cent) and €274 million by mover purchasers (27.1 per cent).

The value of mortgage approvals fell by 21.2 per cent month-on-month but rose by 3.3 per cent year-on-year. During 2021 a total of 53,335 mortgages were approved to the value of €13.4 billion.