BPFI Mortgage Approvals Report June 2020 & Mortgage Drawdowns Report Q2 2020

Latest BPFI figures show unsurprising reduction in mortgage drawdowns in Q2 2020, however mortgage approvals show monthly rise

Future trends difficult to predict with normal seasonal trends disrupted by Covid-19

Banking & Payments Federation Ireland (BPFI) has today published the latest figures from the BPFI Mortgage Drawdowns Report for Q2 2020 and BPFI Mortgage Approvals Report for June 2020.

The following are the key figures from the Mortgage Drawdowns Report for Q2 2020:

  • 6,622 new mortgages to the value of €1,462 million were drawn down by borrowers during the second quarter of 2020.
  • This represents a fall of 34.8% in volume and 35% in value on the corresponding second quarter of 2019.
  • A comparison with the previous quarter (Q1 2020) shows a fall of 24.1% in volume and 26.7% in value.
  • First-time buyers (FTBs) remained the single largest segment by volume (49.6%) and by value (50.3%).

In addition, BPFI also published today the latest figures from the BPFI Mortgage Approvals Report for June 2020. The following are the key elements:

  • A total of 2,263 mortgages were approved in June 2020 – some 1,059 were for FTBs (46.8%) of total volume) while mover purchasers accounted for 557 (24.6%).
  • The number of mortgages approved in June rose by 20.4% month-on-month but fell by 49.5% compared with the same period last year.
  • Mortgages approved in June 2020 were valued at €536 million – of which FTBs accounted for €253 million (47.2%) and €149 million by mover purchasers (27.8%).
  • The value of mortgage approvals rose by 21.3% month-on-month but fell by 48% year-on-year.

Speaking on the publication of the data, Brian Hayes, Chief Executive, BPFI said: “This latest set of figures shows that mortgage drawdowns have held up relatively well in the second quarter of this year despite the overall downward trend and scale of disruption to the economy. In the current volatile environment, we do not expect the market to follow the normal seasonal patterns so the rest of the year will be difficult to predict. However, it is likely we may see a bigger Covid-19 impact in our next set of quarterly drawdown figures due to the time lag between mortgage applications, approvals and drawdowns”.

“Looking at the approvals figures for June, while the year-on-year figure was well down, almost 50% on this time last year, activity in June did see a 20% increase on May. The increase indicates a level of resilience and robustness in the market which has been bolstered by the removal of some Covid-19 restrictions since mid-May. However, any indications of a recovery need to be treated with caution as it is early days in the economic journey.

“Overall, our message is that lenders are continuing to approve new mortgage applications and consumers should actively proceed with mortgage applications where their incomes and employment circumstances have not been impacted by the current pandemic and where they meet the normal lending criteria ”, said Mr. Hayes.

Data Series: Mortgage drawdown data from Q1 2005 onwards is available in Microsoft Excel XLS format in the BPFI Mortgage Drawdowns report data series. Download the BPFI Mortgage Drawdowns Report time series here.

All mortgage approvals data from January 2011 onwards is available in Microsoft Excel format (*.xls) in the BPFI Mortgage Approvals report data series. The BPFI Mortgage Approvals report data series since January 2011 is available to download here.

Note: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland.  Together with its affiliates, the Federation of International Banks in Ireland and the Fintech & Payments Association of Ireland, BPFI has 100 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.

Contact: Jillian Heffernan, Head of Communications, 087 9016880

The BPFI Mortgage Approvals Report June 2020 is available for download below in PDF format.