Mortgage owners are switching providers to save money as interest rates rise amid the current strain on the cost of living.
Banking & Payments Federation Ireland (BPFI) figures show a total of 5,255 mortgages were approved last month, with first-time buyers accounting for 45% of this number. The total was down nearly 12% from the previous month, but up 4.4% from the same period last year.
At face value, mortgages approved in July were worth €1.4bn, down nearly 13% from the previous month.
Much of the activity in July came from activity other than mortgage purchases, including switching and replenishment. The category grew by 95.8% year-on-year in volume to 1,741 and in value by 147.6% to €441 million.
However, a series of rate hikes planned by the European Central Bank are expected to weaken demand in the coming months.
The ECB surprised investors last month by raising interest rates by 50 basis points on concerns that inflation was becoming entrenched in the eurozone economy. Another September rate hike is seen as a deal as key data points to a further rise in core inflation.
BPFI Chief Executive Officer Brian Hayes said, “Our latest mortgage data reflects a continued decline in mortgage activity, primarily non-purchase mortgages, primarily remortgaging or switching. It shows growth.
“If we look at the annualized figures that allow us to better assess the new key trends, there were 55,689 mortgage approvals in the 12 months to July 2022, worth €14,753 million. , representing a 0.40% increase in volume and a 1.17% increase in value compared to the 12 months ending June 2022.”
“No-purchase mortgage activity, most of which has been switched, has surged since May, reflecting both competition in the market and the fact that mortgage customers continue to shop for better rates. increased to ,” he said.
“Whether mortgage customers switch to another mortgage lender or renegotiate with their current lender, we are proactively taking steps to minimize the impact of the ECB’s planned rate hikes. We welcome the fact that