We're all €100,000 better off – but don't think of spending it
Published 12/11/2013 | 02:00
WE may not be feeling flush just yet, but household wealth in Ireland is on an upward trend.
The boost in our fortunes, on paper at least, has been helped by a rise in house prices and the repayment of borrowings from the boom era, according to Central Bank data.
Its Quarterly Financial Accounts show that the notional value of household assets in Ireland increased by a total of €6.5bn between the start of April and the end of June.
In theory, that adds just over €100,000 to the average wealth of every citizen, including the value of assets such as property and shares.
The numbers were up at the end of June thanks to the 2.3pc rise in house prices over the period, and despite a decline in the value of savings.
The numbers were also helped by a reduction in household debt. The value of household debt, including mortgages, peaked in 2008, and has now dropped back to the lowest level since the second half of 2006.
Total household debt in Ireland fell by €1.7bn, to €170.3bn between April and June. That's equal to a debt of €37,135 each for every man, woman and child in the country. But debts and assets are spread so unevenly the Central Bank figures can bear little resemblance to typical households.
However, a rise in overall wealth can still have a "feel-good" effect, including boosting consumer spending.
Separately, data from the Irish Bankers' Federation (IBF) and PricewaterhouseCoopers (PwC) provided the latest confirmation that a pick-up in the mortgage market continued into the second half of the year.
Figures from the IBF and PwC published yesterday showed that mortgage lending increased to €750m in the three months to the end of September.
There were 4,482 home loans drawn down in the period, up from just more than 3,000 at the end of June.
There was a 12.5pc increase in the number of mortgages drawn down, and a 13pc increase in overall borrowing in the three months to the end of September, compared to the same time last year.
First-time buyers (51pc) and people moving home (35pc) account for the vast bulk of the new lending.
In contrast, so-called "buy to let" investors accounted for less than one in 20 mortgages over the period.
Irish IndependentFollow @Independent_ie