Median first-time buyer mortgages and household incomes reach highest level on record – BPFI mortgage report
- Median FTB mortgages increased by €20,000 year on year to €270,000 with FTB household incomes increasing by 6.5% to €82,000 over the same period
- Median age of FTBs rose to 35 however loan terms remained stable
- The median FTB income on new property mortgages surpassed €100,000 in both Dublin and Kildare
Friday 17th November 2023 – The latest Mortgage Market Profile Report H1 2023, published today by Banking & Payments Federation Ireland (BPFI) shows that first-time buyer (FTB) mortgages and incomes reached their highest level on record as median age of FTBs rose to 35 for the first time.
This latest report in the series, which looks at the profile of borrowers, their loans and property types on a national basis as well as across regional basis, analyses how the market for home mortgages has changed in recent years.
Key findings from the report show:
- The median FTB mortgage increased by €20,000 year on year in H1 2023 to €270,000, while the median mover mortgage rose by less than €4,000 to €290,500. During the same period, median basic household incomes increased by 6.5% year on year for FTBs to almost €82,000, and by 5.2% for mover mortgages to more than €111,000.
- More than half of FTB drawdowns (57%) now involve high-value mortgages of over €250,000 and high total household incomes (56%) of over €80,000, the highest proportions recorded either by BPFI or the Department of Housing.
- Incomes on FTB drawdowns have increased substantially, with FTB median incomes on existing property mortgages increasing by about €4,000 year on year to about €75,000 in H1 2023 and FTB median incomes on new property mortgages rising by over €7,000 to more than €93,000. The median FTB income on new property mortgages surpassed €100,000 in both Dublin and Kildare, increasing by about €12,000 and €11,000, respectively.
- The median age of main FTB borrowers rose to 35 for the first time while the share of FTB borrowers aged over 35 increased to 44%, from 36% in 2019 and only 17% in 2004, according to historical data from the Department of Housing. Only one in five or 20% of FTB borrowers were under the age of 30 years of age, down from 60% in 2004. This may partly reflect higher borrower incomes as, on average, incomes rise in line with age.
- Loan terms have remained stable with the median loan mortgage term for FTBs at 30 years since at least H1 2012 and the share of mortgages with loan terms over 30 years stable at about 40% for much of that time, with the longest loan term at 35 years.
Commenting on today’s report Brian Hayes, Chief Executive, BPFI said: “Our latest Mortgage Market Profile continues to point to a trend we’ve seen emerge in recent years, which is that first-time buyers are very much dominating the mortgage market, despite headwinds from rising property prices and European Central Bank interest rate increases. In H1 2023 there were 11,313 FTB drawdowns valued at almost €3.2 billion which were the highest H1 FTB volumes and values since H1 2007. These figures along with the positive mortgage approvals pipeline we’ve seen in recent months establishes a solid foundation for a strong end to the year.”
“In terms of delving into the details behind these figures, this report provides important insights into the mortgage market in Ireland and gives us a very clear picture of the market across many dimensions, from age and type of house to geographic location.”
“We previously highlighted that the average FTB mortgage drawdown reached the highest level on record in Q2 2023 at more than €284,000. Today’s report shows that the median FTB mortgage increased by €20,000 year on year to €270,000 in H1 2023 reflecting higher housing prices. It’s interesting to note that over that same period FTB household incomes increased by 6.5% to €82,000. In fact, as the report shows, as of 2022 more than half of FTBs had loans over €250,000 and total incomes over €80,000.”
Beyond the headline figures, there are significant regional variations. While the median FTB mortgage rose in all regions, the median mortgage increased by more than €26,000 in Kildare, Limerick and Meath. On the other hand, in four regions (Border, Midlands, South and Mid West and West), the median FTB mortgage was less than €215,000 and the median FTB basic household income was €70,000 or less.
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.