Mortgage lending up 7% in Q4 as growth continues for a third quarter

Mortgage lending up 7% in Q4 as growth continues for a third quarter

Mortgage lending has risen for three successive quarters

The IBF/PwC Mortgage Market Profile published today shows that 3,856 new mortgages to the value of €639 million were issued during the fourth quarter of 2011.  This brings to 14,273 the total number of new mortgages issued in 2011 to a value of €2.5 billion.

While the level of new lending in Q4 2011 is down some 31% by volume on the previous year, it is up almost 7% on the preceding quarter.  This latest quarter increase represents the third consecutive quarter of growth and is the first time since Q4 2005 that the number of new mortgages issued has increased in three successive quarters.

The key home purchaser segments of the market – first-time buyers and mover-purchasers – continue to dominate what is now a smaller market in terms of overall activity.  Together they now account for four-fifths of all new mortgages issued. In effect, over 85% of all mortgage credit now goes to the home purchasing segments of the market.

Notably the average first time buyer’s loan now stands at an all-time low of just over €159,000.  This is reflective of falling house prices and increased affordability.

Commenting on the latest data, Pat Farrell, IBF Chief Executive, stated: “Three successive quarters of growth provide the first tentative signs that the market may be stabilising.  However, it is still too early to view this as an indicator of recovery in the market, because Q4 is typically a strong quarter and Q1 is less so.  The fact remains that the economic environment remains very challenging.”

The IBF/PwC Mortgage Market Profile can be viewed here.

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