Mortgage approvals rise

Just under 1,700 mortgages were approved by Irish lenders in October, representing a monthly increase of 10.3% in the homeloan approval rate.

On a year-on-year basis, mortgage approvals were up by 27% last month.

The data — published yesterday by the Irish Banking Federation (IBF) — shows the vast majority of the lending was for house purchases; with 1,565 loans granted for this purpose.

The remaining 112 approved loans were spread across re-mortgages and top-up mortgages. The approval rates in the latter categories were down, while approvals for purchase were up by over 37%, according to the data.

The average mortgage approval value — for house purchases — was down 3%, year-on-year, to €174,677.

IBF director of public affairs, Felix O’Regan said the figures provide “an important lead indicator” of future 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.

“Since the majority of approvals usually lead to draw downs, the level of approvals in October suggests that the drawdown figures for the fourth quarter — when published in the new year — could show some further growth in the market,” he said.

However, he noted the approval data for November and December will need to be seen before a more definitive judgment on whether a third consecutive quarter of sustained growth in the market is real.

Davy Stockbrokers said the upturn in approvals is “encouraging”, but “lending remains at subdued levels”.

Trevor Grant, of the Association of Expert Mortgage Advisers, meanwhile, said the rise in activity has been helped by an increase in the number of institutions lending again, but added banks could still be more flexible in how they deal with applicants.

He noted the potential effect of the abolition of mortgage interest relief for first-time buyers at the end of next month.

© Irish Examiner Ltd. All rights reserved

Email Updates

Receive our lunchtime briefing straight to your inbox

More in this Section

Dollar falls as investors eye Donald Trump's protectionist plan

Apple seeks a bigger bite of mobile market

Given all the risks, sterling could fall back to 90 pence

Credit unions hope to boost new mortgage lending


Breaking Stories

RealD wants to make glasses-free 3D a reality

What is net neutrality and where does Donald Trump stand on it?

Windows 10 is to let users choose between longer battery life and better performance

HSBC to close 62 branches in the UK in 2017

Lifestyle

Making cents: Shopping around is still the best way to save some cash

Reframing Michael Collins in The Big Fellow

It's been a long and winding road for music group Fairport Convention

We’ll have to shout ‘stop’ to non-bio plastics, or else...

More From The Irish Examiner