Buyers curtailed by higher borrowing costs, causing sharp decline in mortgage approvals.

The real estate market has seen a sharp decline in mortgage approvals as higher borrowing costs continue to restrict potential buyers. With interest rates on the rise and home prices steadily increasing, many would-be homeowners are finding it increasingly difficult to obtain approval for a mortgage. As a result, the housing market has become increasingly competitive and many are struggling to secure the financing necessary to purchase a home. In this article, we will explore the reasons behind the decline in mortgage approvals and what it means for those seeking to purchase a home in today’s market.


Last month, a decline in mortgage activity was witnessed in the State’s housing market due to increased borrowing costs. The Banking & Payments Federation Ireland (BPFI) revealed that both volume and value of approved mortgages fell as lenders raised their rates to match European Central Bank (ECB) rate hikes. In the same period, the approval of 3,378 mortgages was recorded (down by 8.6% and 13.3% compared to the previous month and last year, respectively), of which first-time buyers (FTBs) accounted for 55.6% of total volume. The value of approvals also dropped by almost 7% and 8.1% month-on-month and year-on-year, respectively. Non-purchase mortgage activity, which includes switching and top-ups, fell by 30.9% and 32.6% in terms of volume and value, respectively. Despite the decline in switching activity, mortgage activity is still at historically high levels, particularly among FTBs. While global property markets slow down, house prices in Ireland are expected to grow at a less rapid pace this year.


In conclusion, it is evident that higher borrowing costs have had a significant impact on the mortgage market, resulting in a sharp fall in mortgage approvals. Buyers are now facing tough decisions when it comes to purchasing a property, with many being priced out of the market due to these rising costs. The current situation is certainly concerning, but there is hope that the market will stabilize and adjust as we move forward. In the meantime, it is essential that buyers, lenders, and policymakers work together to find solutions that benefit everyone involved. Whether it’s exploring alternative financing options or implementing policies to make property more affordable, there is much that can be done to tackle this issue and ensure that the dream of homeownership remains accessible to all.