THE HIGHEST VOLUME of first-time buyers entering the housing market in the second quarter of a year since 2007 was recorded at the end of last month.

The Banking and Payments Federation of Ireland’s (BPFI) quarterly update on mortgage drawdowns has found that there was a 20% increase in the volume of first-time buyers entering the housing market last quarter compared to the first quarter of this year.

Though the high volumes represent that more and more people are drawing down mortgages to become homeowners, the BPFI says there’s “moderation” in the activity of the market.

Moderation in the market, as explained by Chief Executive of the BPFI, Brian Hayes, is reflected in the reluctance of those who already own or previously owned a property, drawing down a new mortgage and moving home.

These are called “mover purchase mortgages”, and the volume of drawdowns for them fell by 3.1% last quarter.

This means that, while more and more people – especially first-time buyers – are purchasing into their first home, those who already have paid their mortgage in full are not interested in moving.

It is the seventh consecutive quarter where mover purchases drawdowns have fallen, in year-on-year terms, according to the BPFI’s Hayes.

While this would usually create a good opportunity for first-time buyers to enter the market, it’s more likely that these mover purchase mortgages are not being drawn down as a result of the short supply of housing.

A recent report from Daft.ie found that housing supply in May had fallen all around the country.

A separate report from the CSO this month found that housing completions during the second quarter fell short of targets.

Today’s BPFI report says that more than a third of all mortgages went towards new properties, including self-builds, and reflects a four-percentage-point increase from the previous quarter.

But it’s worth noting that Government subsidies in the First-Time Buyer Scheme are only available to those moving into a newly-built home.

The figures in this report could intensify criticisms that the First-Time Buyer scheme is propping up the market, at a cost to those who want their first home.

While overall drawdown volumes increased by 2.2%, first-time buyer drawdowns increased by more than double that (5.5%). It is the highest volume of first timers entering the market at this point in a year since 2007.

Additionally, out of a total of 10,100 new mortgages which were were drawn drown by borrowers from April to June of this year, more than half (62.3%) of these borrowers were first-time buyers.

The trend is likely to continue as out of the 4,480 mortgage applications which were approved last month, more than half of those are going to first-time buyers.