Mortgage approvals rose 1.6% month-on-month and 9.6% year-on-year in November, the latest mortgage approvals report from the Banking & Payments Federation Ireland (BPFI) shows.

A total of 5,433 mortgages were authorised during the month, including 2,533 for first-time buyers (46.6%) and 1,148 for mover-purchasers (21.1%).

The value of mortgages approved in November was close to €1.5bn, an increase of 2.5% from October and 16.8% from November 2021, with first-time buyers accounting for €699m (46.6%) and mover-purchasers €359m (24%).

Non-purchase mortgage activity, which includes switching and top-ups, grew by 64.4% year-on-year in volume terms to 1,647, and by 93.3% on annual basis in value terms to €425m, driving the increase in approvals activity.

Trevor Grant, chair of the Association of Irish Mortgage Advisors (AIMA), said the homeowners on variable and tracker rates are "increasingly worried" about their repayments following several interest rate increases by the ECB since the summer.

In Association with

Grant credited that widespread concern for the growing numbers of switchers and said switching would continue to grow with rates expected to be raised further in the coming months.

Tracker rates, which are tied to the ECB main lending rate, have increased from 0% to 2.5% since July, and Grant brought up a survey that showed that the average tracker mortgage holder could save €5,500 by switching to the most competitive fixed rate.

Similarly, homeowners on existing fixed rates are concerned about what will happen when their fixed rate expires. Grant said it "may be possible to break their existing fixed rate without penalty and lock in at today's rates before any further increases."

For the year to date, there 54,461 approvals valued at €14.9bn, the highest levels since the BPFI began tracking the data in 2011, and up from 49,479 approvals valued at €12.4bn in the same period of 2021.

“While first-time buyers remain the largest segment in the mortgage market with approvals valued at some €7.1bn in the year to November, increased switching activity is largely driving the rate of growth, with volumes up by 73% year-on-year to more than 16,000, as customers continue to seek out new deals to minimise the impact of ECB interest rate decisions," said Brian Hayes, CEO of the BPFI.

“We expect to see the healthy pipeline in approvals reflected in strong drawdown figures, especially in value terms, in Q4 2022.”

(Pic: Getty Images/Getty Images)