September 17, 2021

MP Now News

Mortgage News

Sharp increase in volume and value of mortgage approvals

According to figures from the Banking and Payments Federation (BPFI), both the volume and the value of approved mortgages rose sharply in May compared to the same period last year.

The numbers show that there were 4,683 mortgage approvals worth 1.2 billion euros. Mortgage approval activity increased by 149.2 percent in volume compared to the previous year and by 162.5 percent in value over the same period.

The increase can be explained by a significant decline in mortgage activity last year when the state got hold of the Covid-19 crisis.

In May, 3,814 residential mortgages were approved, an increase of 188.9 percent to a value of 986 million euros. These registrations rose by 188.9 percent in volume compared to the previous year and by 204 percent in value over the same period.

First-time home buyer mortgage approval volume (FTB) rose 202.8 percent year over year to 2,580, while moving house approval volume rose 162.3 percent to 1,112.

The approval volume for residential investment leasing (RIL) rose by 177.3 percent to 122. The approval volume for debt rescheduling / remodeling mortgages rose by 38.3 percent to 585, while the number of top-up approvals rose by 108.8 percent compared to the previous year 284.

The value of FTB mortgage permits rose year-on-year by 220.7 percent to 643 million euros, while the value of relocation purchase permits rose by 175.4 percent to 325 million euros.

RIL mortgage approval values ​​rose 212.2 percent to 18 million euros. The value of the rescheduling / exchange permits rose by 34.7 percent to 143 million euros, while the value of the recharging permits rose by 174.3 percent to 30 million euros.

By the end of May 2021 there were 48,935 mortgage approvals worth 12 billion euros.

Annualized mortgage approval activity through May increased 6 percent in volume and 6.4 percent in value compared to the 12 months ended April 2021.

The annualized purchase mortgage approval volume rose 6.6 percent year-over-year to 40,098 in the 12 months ended May 2021, while the annualized purchase mortgage approval value was 1.2 billion euros, an increase of 7 percent over the same period .

BPFI boss Brian Hayes said May was “another very strong month” for mortgage approvals, “especially for first-time buyers”.

“It is important that we look at these numbers in the context of the country’s business in May 2021 versus 12 months earlier,” he said.

“While a number of Covid restrictions were lifted in May, lenders and customers were also much better prepared to work within the restrictions, and the numbers clearly show that.”

Mr. Hayes found that in the 12 months ended May 2021, 38,882 more home buyer / builder loans were approved than in any 12 month period since the series began in 2011.

“In terms of value, building permits for homes / buildings approached the € 10 billion mark for the first time. These are significant numbers and signal a robust pipeline for drawdown activity later in the year, ”he said.