Figures released today show the number of new mortgages issued by banks has fallen substantially.
The figures from the Irish Banking Federation (IBF) for the first quarter 2008 were down 24.3 per cent on the previous quarter and 19.8 per cent on the same period in 2007.
The IBF/PwC Mortgage Market Profile found 28,508 new mortgages to the value of some €6.3 billion were issued during the first quarter of 2008, bringing the overall mortgage book to €142 billion.
The research also found the share of the total market held by first-time buyers and by mover-purchasers is down by volume compared with the previous quarter, but that the segment accounted for by investors recorded a slight increase.
The level of remortgaging continues to grow, according to the survey. With a 26.2 per cent share of the market by value, switching is now the largest market segment - having increased its market share by 12 percentage points over the past two years.
The IBF said the trend of falling mortgage lending is consistent with all other indicators of housing market activity.
Commenting on the findings, IBF chief executive Pat Farrell said: “On the supply side, credit availability has tightened. On the demand side, there is a strong demographic cohort of potential house buyers, but many of these appear to be holding off for the moment in anticipation of further house price reductions.”
The IBF is the leading representative body for the banking and financial services sector in Ireland.