A TOTAL OF 1,677 mortgages were approved by lenders in Ireland during the month of October – marking an increase of some 26.9 per cent on the same month in 2011, new data on mortgage approvals shows.
The IBF Mortgage Approvals Report shows this increase also represents an increase of 10.3 per cent over the previous month of September.
The overall number, made up almost entirely of mortgage approvals for house purchases (1,565), increased year-on-year by 37.3 per cent. However, the much lower number of approvals for re-mortgages and top ups (112) declined over the same period.
The average mortgage approval value for house purchases stands at €174,677 – a fall of 3 per cent year-on-year.
Data collection for this latest IBF Mortgage Approvals Report began in August 2012, and covers the period from January 2011 onwards in respect of the market’s main mortgage lenders.
New mortgage lending still down significantly from boom
However, gross new mortgage lending is still down significantly when compared with the years 2005 and 2006.
In 2001, the total volume of new mortgage lending was 14,273 at a value of €2,463 million.
In contrast, the volume of gross mortgage lending in 2005 was 201,260 at a value of €34,114 million, while the volume in 2006 was 203,953 at a value of €39,872 million.
Commenting on the data, IBF’s Director of Public Affairs, Felix O’Regan, said the report provided an important lead indicator of future mortgage market activity. ”The significant uplift it shows in the level of mortgage approvals is further welcome evidence of renewed activity, coming as it does on the heels of figures we published earlier this month which confirmed the first year-on-year increase since 2006 in the number of new mortgages actually drawn down.”
However, he also warned that mortgage interest relief was a contributory factor in the recent increase of approvals: “The level of approvals for November and December will need to be seen before a more definitive judgement can be made. The availability of mortgage interest relief is seen as a contributory factor and it remains to be seen what effect its abolition after 31st December will have.”
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