Both mortgage drawdowns and approvals continued to grow steadily in Ireland in the second quarter of 2019.
The volume of mortgages drawn down grew by 9% in the second quarter, matching the pace seen in the first quarter.
By value, new mortgage lending grew by 12% year on year (yoy). Focusing purely on mortgages for house purchase, new lending volumes grew by 8% yoy, while the value of lending grew by 11% yoy.
The pick-up in activity for house purchase in Q2 was led by first-time buyers, where lending grew by 11% yoy. Mover purchaser lending grew by 6% yoy in both volume and value terms, while Buy to let lending continues to be anaemic.
The data is also broken down by house type and shows that lending in the new homes market continued to be relatively subdued in Q2. In Q2, drawdowns on new homes increased by 2% yoy in volume terms and by 5% yoy by value.
This represents a significant slowing on the growth seen throughout 2018. In contrast, there was a pick-up in lending in the second-hand market, where growth rose to its highest level since Q3 2017.
Last week, Goodbody Stockbrokers published new analysis that showed a weaker profile for new homes sales in the higher-end market in Dublin that has triggered a slowdown in home completions. This may have implications for the size of the market in the medium-term if this trend were to continue.
According to Goodbody Stockbrokers, "Approvals for remortgaging have slowed significantly, with the annual growth rate turning negative in June for the first time since 2014. Over the quarter, the volume of approvals for remortgaging grew by just 5% yoy (+1% yoy by value). Having fallen aggressively, interest rates have been more stable over the past year while there has been less focus on mortgage rates."