The COVID-19 pandemic and subsequent lockdowns have had many effects on business throughout the world and in Ireland. Every industry has been affected by this pandemic, and many in negative ways. However, this is not exactly the case with the mortgage industry in Ireland.
The mortgage industry in Ireland has remained remarkably buoyant over the past year. This is especially significant due to the fact that the country has been under level 5 lockdowns since March of 2020. While one would expect mortgage drawdowns and approvals to decrease like most economic activity, what happened instead was surprising. For the first quarter of 2021, BPFI reports that there were 9,091 new mortgages worth €2.1 billion drawn down by borrowers. These numbers represent a 4.5% increase in volume and a 7.3% increase in value when compared to the corresponding quarter of 2020. This was also the most drawdowns approved in Q1 of any year since 2009.
March 2021 was also a strong month for mortgage approvals, especially when considering First Time Buyers (FTBs). In March of 2021, a total of 4,324 mortgages were approved, up 18% from the previous month. First time Buyers accounted for 2,394, or 55.4% of these mortgages, and mover purchasers accounted for 924, or 21.4%. These mortgages approved in March 2021 €1.064 billion, of which FTBs accounted for €608 million, or 57.2%, and 260 million by mover purchasers, or 24.5%.
Speaking on this data, chief executive of BPFI, Brian Hayes, said “Our latest mortgage drawdowns and approvals data for Q1 [first quarter] 2021 is showing a very strong performance considering that Level 5 Covid restrictions were in place for the entire first quarter of this year… Similarly we have seen strong growth in approvals which are up 7.8% in the first quarter of this year compared to the same period in 2020. This shows a strong pipeline for future demand as we move into the latter part of the year.”
The uptrend referenced by Hayes continued throughout April. According to BPFI, 4,362 mortgages were approved in April 2021, with First Time Buyers accounting for 2,389 of these mortgages, or 54.8% of total volume. These mortgages approved in April 2021 were valued at 1,089 million euros, of which FTBs accounted for 600 million, or 55%. In regard to the figures from April, Hayes stated “April was another strong month for mortgage approvals, especially for first-time-buyers. Compared with April last year, when the country was experiencing its first lockdown, there has been a doubling of activity across most mortgage categories during April 2021.”
This trend shows the continued success and resiliency of the Irish mortgage market throughout this pandemic, and bodes well for future increases in both drawdowns and approvals as more and more restrictions continue to be lifted.