Mortgage approvals in Ireland rebounded in February, according to the Banking and Payments Federation of Ireland (BPFI) data published this morning.
By volume, mortgage approvals grew by 7% year on year (yoy) in February, with the value of mortgage approvals up by 10% yoy. First-time buyers (+7% yoy by volume, +11% yoy by value) and movers (+15% yoy by volume, +10% yoy by value) drove this better performance. Approvals for remortgages are still growing (+4% yoy by value), but at a significantly slower pace than that seen in 2018.
Focusing on mortgages for house purchase, the value of approvals grew by 3% yoy in the three months to February, the strongest performance since June 2018. Within this, the value
of First Time Buyer (FTB) approvals grew by 4% yoy, while the value of approvals for movers grew by 3% yoy.
Goodbody Stockbrokers believe It is notable that the average mortgage approval for mover purchasers has fallen over the past twelve months (-1%). This may reflect the weakness at the higher end of the property market in Ireland.
Growth in the average mortgage for FTB has also slowed (+3% yoy in three months to February), reflecting a more subdued rate of house price inflation over the period. Approvals for Buy-to-let (BTL) mortgages remain exceptionally small (2% of new lending) and have fallen further over recent months.
According to Goodbody Stockbrokers, "Coming at a time of heightened uncertainty around Brexit, this improvement is welcome and consistent with our view that mortgage lending will continue to expand to c.€10bn this year (+15% yoy)."