Mortgage drawdowns for first-time buyers hit highest level since 2007

First-time buyers drew down more than €7.8 billion in new mortgages last year, with the volume of mortgages reaching 26,242. These were the highest annual levels since 2007, according to Banking & Payments Federation Ireland (BPFI).

Across the market, more than 13,000 new mortgages with a value of €3.9 billion were drawn down by all borrowers in the fourth quarter, bringing total drawdowns in 2024 to 43,030.

The value of mortgage drawdowns over the year rose 4 per cent to €12.6 billion, but volumes fell 1.3 per cent year-on-year, according to new figures from BPFI.

There was volume growth in the first-time buyer segment, however, with the number of drawdowns up 2.5 per cent compared with 2023, and values rising 8.4 per cent.

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It was also a more positive fourth quarter across the market, with the volume of drawdowns up 12.3 per cent on the same quarter in 2023 and the value of the loans up 20.1 per cent.

A separate BPFI report on mortgage approvals showed a total of 3,592 mortgages were approved in December, almost 60 per cent of which were for first-time buyers.

The number of approvals was up 28.6 per cent on December 2023. Meanwhile, mortgages approved in December 2024 were valued at €1.1 billion, up 37.9 per cent year-on-year.

A total of 51,337 mortgages with a value of more than €15.3 billion were approved in 2024. Approval volumes rose by 2.9 per cent year-on-year, while values rose by 8.2 per cent.

“Our latest mortgage data, shows another strong year for first-time buyers who have dominated the mortgage market in recent years,” said BPFI chief executive Brian Hayes.

“While activity in the overall market was more subdued, solid growth in approvals activity points to a positive outlook for 2025 and beyond.”

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Almost 119,000 first-time buyer mortgages have been drawn down in the past five years, Mr Hayes added.

“It’s particularly encouraging to see strong growth in first-time buyer mortgages on new property purchases or self-builds which reached their highest annual volume and value since 2008 and 2007 respectively.”

Although mortgage activity beyond the first-time buyer segment was “more mixed”, demand for housing and mortgages “remains very strong”, Mr Hayes added, as evidenced by the continued rise in average mortgage drawdown values.

The average first-time buyer mortgage on new properties increased 1.6 per cent year-on-year to €321,912, while the average first-time buyer mortgage on second-hand properties rose 7.4 per cent to €283,969.

The drop in drawdown volumes was “partially attributable to further declines in mover purchase and switching activity”, he said.

Responding to the BPFI data, Irish Mortgage Advisors chairman Trevor Grant said the figures for first-time buyers were “a clear indicator” of strong demand for home ownership.

“While this is encouraging, we need to see significantly more new homes delivered to curb house price inflation and meet growing demand.”

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