Home loan figures soar by 25%

Demand for mortgages is continuing to soar – despite indications that the long-running property boom may be nearing an end.

Figures from the Central Bank today showed home loans last month were 24.6% higher than in September last year and 0.4% more than during the previous four weeks.

During the month, financial institutions handed out close to €1.4bn to homebuyers.

The latest returns followed a report earlier this week from the Central Statistics Office reporting that the Irish economy grew faster than anticipated during the second quarter of 2003.

Also this week, however, an index from the Permanent tsb bank suggested that house prices were levelling off in Ireland after recording their lowest monthly increase for some years.

The continuing growth in mortgage lending is an acknowledged concern for the Central Bank, which has warned the commercial banks and other companies about the need for prudent policies on the loans front.

Today the bank said mortgage growth was currently higher than at any stage since December 2000.

Home loans and overdrafts were the main drivers of credit growth in Ireland during September, with the rise in overdrafts particularly sharp when compared to a sharp fall in August.

Meanwhile, the amount of money held on deposit increased in all categories. And the annual rate of credit growth in the economy was 14.7% in September, slightly more than in August.