500 first-time buyers a week get approved to take out mortgage
Almost 500 first-time buyers are getting approval every week to take out a mortgage.
The overall number of property buyers being approved for a mortgage has also shot up in the first 10 months of the year.
Close to 2,000 first-time buyers got the go-ahead from their bank to take out a mortgage in October. This works out at almost 500 new borrowers a week entering the market equipped with mortgage financing.
Figures from the Banking and Payments Federation Ireland show a total of 3,751 mortgages were approved last month. This is 20pc higher than the same month last year.
In the first 10 months of the year, some 36,400 potential buyers have been given the go-head to borrow, a rise of 27pc on the same period last year.
The average amount approved for a mortgage is up 10pc on last year to €215,000.
Not all of those being approved for a mortgage end up buying, but figures from specialist bank Investec show the numbers being approved for a mortgage are close to the eventual number that ends up drawing down a home loan.
Mortgages to the value of almost €8bn have been approved so far this year. This compares with €5.63bn worth of mortgages for the same period last year.
First-time buyers make up half of the total approved loan applications, with mover-purchasers representing a third of total approvals.
New buyers are largely behind the rise in the numbers getting approval to borrow.
There was a 31pc rise in the number of first-time buyers getting the go-ahead to borrow in the year.
Dermot O'Leary, economist with Goodbody Stockbrokers, expects mortgage drawdowns to be around €7.3bn this year, a rise of 28pc on last year. For next year he expects the banks to issue €8.6bn in mortgages.
One of the fastest growing segments in the mortgage approval figures is for those switching lender.
This is as a result of property owners seeking to move their mortgage to save money in a market characterised by an interest price war. But the numbers switching remains low, with 321 people moving in October this year. This is down on the number who switched in the same month last year.
There is an increase in the number of investors taking out mortgages. However, the numbers are low, with just 181 buy-to-let mortgages approved in October.