First-time buyers dominate mortgage market as FTB drawdowns reached €1.9 billion in Q3, the highest Q3 values since 2006 – BPFI
- FTBs accounted for almost 80% of home mortgage drawdowns on new properties and 69% of secondhand properties in Q3, with 470 FTB mortgages valued at €131m drawn down per week so far in 2023
- FTB mortgage approvals reached new 12 month high with 30,184 mortgages approved in the 12 months ending September 2023
- Continued decline in switching activity drives overall slowdown in mortgage market but home purchase mortgage levels remain stable
Friday 27th October 2023 – Banking & Payments Federation Ireland (BPFI) has today published the latest figures from the BPFI Mortgage Drawdowns Report for Q3 2023 and the BPFI Mortgage Approvals Report for September 2023.
The following are the key figures from the Mortgage Drawdowns Report for Q3 2023:
- A total of 11,614 new mortgages to the value of €3,172 million were drawn down by borrowers during the third quarter of 2023.
- This represents a decrease of 21.8% in volume and 21.8% in value on the corresponding third quarter of 2022.
- A comparison with the previous quarter (Q2 2023) shows an increase of 17.4% in volume and 14.9% in value.
- First-time buyers (FTBs) remained the single largest segment by volume (60.4%) and by value (61.2%).
- Re-mortgage/switching volumes and values fell by 79.6% and 81.5% year on year respectively.
In addition, BPFI also published today the latest figures from the BPFI Mortgage Approvals Report for September 2023:
- A total of 4,161 mortgages were approved in September 2023 – some 2,541 were for FTBs (61.1% of total volume), while mover purchasers accounted for 919 (22.1%).
- The number of mortgages approved in September fell by 8.2% month-on-month and fell by 22.2% year-on-year.
- Mortgages approved in September 2023 were valued at €1,182 million – of which FTBs accounted for €739 million (62.5%) and €307 million by mover purchasers (26%).
- The value of mortgage approvals fell by 9.3% month-on-month and 19.7% year-on-year.
- Re-mortgage/switching activity fell by 75.8% year on year in volume terms and by 78.8% in value in the same period.
Speaking on the publication of the data, Brian Hayes, Chief Executive, BPFI said: “Our latest mortgage data is showing that while there continues to be an overall slowdown year-on-year in approvals and drawdowns, this is due to the ongoing decline in switching activity and notably home purchase mortgage levels have remained stable.”
“One very striking trend evident from the figures, however, is that first-time buyers are currently very much dominating the mortgage market with FTB volumes and values at their highest levels since 2007 and 2006 respectively, on a year-to-date basis. In fact, about 470 FTB mortgages valued at €131 million have been drawn down per week in the first nine months of 2023 – that’s 18,324 FTB mortgages valued at €5.1 billion.”
“This dominance is very clearly demonstrated when we look at the share of FTBs buying new and secondhand homes. FTBs accounted for almost 80% of home mortgage drawdowns on new properties and 69% of home mortgage drawdowns on secondhand properties in Q3 2023. It is also interesting to see that, notwithstanding the significant government incentives introduced for FTBs buying new properties, their appetite for secondhand homes remains strong. The quarterly value of FTB drawdowns on secondhand properties exceeded €1.3 billion for the first time since the data series began in 2005, while the number of FTB mortgages on secondhand properties was the second highest since 2005 at 4,916 (after 4,930 in Q4 2005).”
Mr Hayes concluded: “Looking at our latest approvals figures, which we also published today, we can see that although the monthly volume of mortgage approvals likely peaked during the summer months, the pipeline continues to strengthen with 30,184 FTB mortgage approved in the 12 months ending September 2023. This was a new high and establishes a solid foundation for a strong end to the year.”
The BPFI Mortgage Drawdowns report is available to download here.
The BPFI Mortgage Approvals report is available to download here.
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 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 over 125 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace here.