Switching drives mortgage growth to record high, report shows

In November, the value of mortgage approvals reached almost €1.5bn. Picture Denis Minihane.

Increased switching activity was the main driver of a record number of mortgage approvals last year, a new report shows.

The Banking and Payments Federation Ireland, or BPFI, published its latest Mortgage Approvals Report which found almost 55,000 mortgages to the value of €15bn were approved in the year to November 2022.

“While first-time buyers remain the largest segment in the mortgage market with approvals valued at some €7.1bn in the year to November, increased switching activity is largely driving the rate of growth, with volumes up by 73% year-on-year to more than 16,000,” said Brian Hayes, chief executive of the BPFI.

Mortgage approvals during that period reached the highest level since the BPFI started gathering this data in 2011. Non-purchase mortgage activity, which includes switching and top-ups, grew by 64.4% year-on-year in volume terms to 1,647 and by 93% year-on-year to €425m.

The rise in switching follows efforts by homeowners to minimise the impact of ECB interest rate hikes, introduced to try and stifle soaring inflation during 2022.

The number of mortgages approved rose by 1.6% month-on-month and by 9.6% compared with the same period in 2021. A total of 5,433 mortgages were approved in November 2022. 

First-time buyers (FTBs) were approved for 2,533 mortgages, or 46% of total volume, while mover purchasers accounted for 1,148. In the same month, the value of mortgage approvals reached almost €1.5bn.