First-time homebuyers are older and earning more than ever - report

Sixty per cent of first-time buyers in Ireland were aged 30 or under 20 years ago, according to figures from the Banking and Payments Federation Ireland (BPFI): now it is just 20 per cent.

A new report by the industry body says the age of the typical first-time borrower hit 35 for the first time earlier this year. Forty-four per cent of people buying their first home in 2023 are older than that, compared with 36 per cent before Covid in 2019 and only 17 per cent back in 2004.

And those buyers have more money. The BPFI report says the typical income of a first-time purchaser of a new home this year in Ireland was €93,000. That is up €7,000 on last year. The report suggests that part of the reason for the higher incomes is that, because buyers are getting older, they are more advanced in their careers.

In Dublin and the surrounding commuter belt, the figures are higher. The median income of first-time buyers of new properties in Dublin and Kildare rose above €100,000 for the first time, increasing by about €12,000 and €11,000, respectively, over the past year, the report says.

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The typical income of a mover-purchaser was €111,000, reflecting the sharp rise in property values seen over the past 10 years.

With the average full-time salary for an individual in the State put at just under €50,000, the figures highlight the affordability gap at the heart of the Irish property market.

The banking lobby group’s report looked at the profile of borrowers, their loans and property types on a national basis as well as regionally, assessing how the market for home mortgages has changed in recent years.

It found that the median value of first-time buyer mortgages increased by €20,000 year on year in the first half of 2023 to €270,000, while the median mover mortgage rose by less than €4,000 to €290,500.

Dublin had the highest median property values for first-time buyers financing new and existing property at €475,000 and €387,400 respectively.

The report noted that about 82 per cent of first-time buyers bought existing properties in Dublin rather than new builds, the largest share in the State, while 40 per cent of mortgages were for terraced properties.

BPFI chief executive Brian Hayes said: “Our latest mortgage market profile continues to point to a trend we’ve seen emerge in recent years, which is that first-time buyers are very much dominating the mortgage market, despite headwinds from rising property prices and European Central Bank interest rate increases.”

“In the first half of 2023 there were 11,313 first-time buyer drawdowns, valued at almost €3.2 billion,” he said, adding that these were the highest figures since 2007.

“These figures, along with the positive mortgage approvals pipeline we’ve seen in recent months, establish a solid foundation for a strong end to the year,” he said.