Mortgage approvals fell by 15 per cent in the three months to the end of February compared to the same period a year earlier as stricter lending restrictions continued to bite, new figures show.
Data from Banking and Payments Federation Ireland (BPFI) show a total of 1,951 mortgages were approved per month on average in the three months to the end of February, with just over half of all approvals for first-time buyers.
However, the figures show the number of first-time buyer approvals was down 27.1 per cent year-on-year, with mover purchaser approvals dropping by 17.5 per cent.
The value of mortgage approvals granted totalled €374 million on average, for the three months to the end of February, down 14.6 per cent on the same period last year, and by 7.9 per cent on a month-on-month basis.
First-time buyers accounted for 48 per cent of approval value, with values falling 21.8 per cent versus a year earlier.
The average mortgage approval value for property purchase rose by 0.9 per cent year-on-year to €196,441. This marked the 29th consecutive period in which the average property purchase approval had risen year-on-year.
Average values vary significantly with mover purchase values highest at €240,853 and first-time buyer values at €179,473, down slightly year-on-year.
Re-mortgage or switching increased its share of mortgage activity to about 8.5 per cent of the value of mortgages approved in early 2016 from about 4.6 per cent in the same period of 2015.
Piba, the country’s largest group of financial brokers, said the figures indicate a worsening situation with mortgage approvals .
“The question now is, how much deeper is this crisis going to get before it turns around. And it will not turn around without unprecedented intervention by the new Government,” Piba’s Rachel Doyle said.
“ If this situation becomes prolonged it will not only continue to prevent first-time buyers, primarily in their 20s and 30s and living in urban areas, particularly the greater Dublin area, from buying their first homes but it will impact the wider economy and, ironically, the banks own balance sheets,” she added.
