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New mortgages plunge by 55pc

THE AVERAGE mortgage total has dropped below €200,000 for the first time since records began in 2005.

And the number of new mortgages issued in the second quarter was 3,551, a drop of nearly 55pc from the same period last year, when 7,827 mortgages were issued.

In the first quarter of 2008, mortgages hit a peak of €283,540, but now this level has fallen to €192,445. Overall new mortgage lending is now listed at €624m, less than half the amount lent out in the corresponding quarter of last year, according to the Irish Banking Federation/PwC mortgage market profile.

First-time buyers and mover purchasers now account for more than three-quarters of the market.

Lenders say that uncertainty about employment, property price trends and a weakening consumer sentiment are reasons the mortgage market is so weak, but banks and building societies are also intent on the need for prudent lending, with a renewed focus on the borrower's capacity to repay.