There was a sharp decline in mortgage approvals in the month of February, data released today by Banking and Payments Federation Ireland (BPFI) shows.
The latest figures from the BPFI Mortgage and Approvals Report for February 2023 showed a significant decline in switching activity amid an overall slowdown in mortgage approvals.
The statistics revealed that a total of 3,378 mortgages were approved in February 2023 – first-time buyers (FTBs) were approved for 1,877 mortgages (55.6% of total volume) while mover purchasers accounted for 801 (23.7%).
However, the number of mortgages given the green light fell by 8.6% month-on-month and by 13.3% compared with the same period last year.
Mortgages which were approved in February were valued at €945 million – of which FTBs accounted for €528 million (55.9%) and mover purchasers for €263 million (27.9%).
However, the value of mortgage approvals fell by 6.9% month-on-month and by 8.1% year-on-year. Non-purchase mortgage activity, which includes switching and top-ups, fell by 30.9% year on year in volume terms to 634 and by 32.6% year on year to €144 million in the same period, BPFI revealed.
Speaking on the publication of the data Chief Executive of BPFI, Brian Hayes, described the decline in approvals as “significant”:
“While our latest figures show a slowdown in approvals across almost all customer segments in volume and value terms, it is important that we look at this in the context of the significant decline we are seeing in switching activity,” he said.
“In February, non-purchase mortgage approvals, mainly made up of switching, fell by almost 31% in volume terms year on year and this decline has had an impact on the overall slowdown we have seen in this month’s figures. This fall off was expected given the substantial wave of switching undertaken by customers in recent months with almost €4.3 billion in new non-purchase approvals (mainly switching) in the twelve months ending January 2023.”
He continued: “Despite the slowdown we have seen in February, it is important to note that mortgage activity remains at historically high levels with almost €1.6 billion in approvals for FTBs and mover purchasers in the first two months of the year.
“Demand is particularly strong among FTBs, which accounted for almost 56% of the volume and value of mortgage approvals in February, with the Revenue Commissioners reporting over 11,000 applications for the Help to Buy scheme in the year to date.”
You can read the BPFI Mortgage Approval Report February 2023 in full here.