Househunters borrowing €100,000 more than they did a decade ago

Rapid rise in house prices leading to major increases in mortgage values
Househunters borrowing €100,000 more than they did a decade ago

The value of mortgages approved last month jumped by more than 13% compared to a year ago.

The average mortgage approved by Irish banks has increased by €100,000 in the past ten years new figures show.

New figures from the Banking & Payments Federation Ireland (BPFI) show the average value of a mortgage approved last month was €276,635. This compares to the average in July 2012 of €177,455.

It highlights the scale of the increase in property values in recent years as the country struggles to build enough homes to meet the demand.

According to the BPFI's latest report, the number of mortgages approved by Irish banks last month fell by almost 12% compared to June. A total of 5,255 mortgages were approved in July, a drop of 11.8% month-on-month but a rise of 4.4% compared with the same period last year. 

The figures also show the value of mortgage approvals fell by 12.7% compared to June but rose by 13.3% compared to July 2021.

€1.45bn approved for mortgages

Mortgages approved last month were valued at €1.45bn — of which first-time buyers accounted for €660m (45.4%) and mover purchasers for €343m (23.6%).

BPFI chief executive Brian Hayes said the figures show continued growth in mortgage activity which is being driven mainly by non-purchase mortgages — primarily those who are re-mortgaging or switching.

“Non-purchase mortgage activity, most of which is switching, has increased sharply since May, reflecting both the competition in the market and the fact that mortgage customers continue to shop around for better rates," he said.

"We welcome the fact that mortgage customers are actively taking steps to minimise the impact of the ECB’s planned interest rate increases, whether they switch to another mortgage lender or renegotiate with their current lender."

Central Bank data shows that the value of housing loans renegotiated at interest rates fixed for more than one year jumped to €1.2bn in Q2 2022 from €0.7bn in Q2 2021.

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