Data published by the Banking and Payments Federation (BPFI) this morning shows that mortgage approvals continued to trend higher in October,
The value of mortgage approvals grew by 29% year on year (yoy). This follows strong growth in both September (+40% yoy) and August (+55% yoy) and thus brings the growth rate to a new high of +41% yoy (+38% yoy in September).
Focusing on the three months to October, the value of approvals for house purchase grew by 37% yoy, with the number of approvals growing by 25% yoy and the average loan size increasing by 10% yoy.
First-time buyers continue to account for the largest share of approvals but approvals for movers are now growing at a faster pace.
In the three months to October, the value of approvals for movers grew by 43% yoy (+31% yoy by number) while FTB approvals grew by 34% yoy (+24% yoy by number).
The fastest growing component of mortgage approvals continues to be re-mortgaging (+89% yoy in most recent three months). This category now accounts for c.10% of approvals, up from 7% a year ago.
According to Goodbody Stockbrokers, "In October’s Budget, the Irish Government announced the Help-to-Buy scheme for FTBs of new homes. The Central Bank has announced a loosening of its macro prudential mortgage rules in recent weeks. Both of these policy developments will support mortgage demand. However, it is clear that mortgage demand was already picking up in advance of these policy developments."
They added, "We are forecasting new lending growth of 19% growth in 2017. These latest trends suggest the market is on track for this forecast."
Source: www.businessworld.ie
