The value of Irish mortgage lending in the first three months of the year was less than a third of loans issued in the same period a year earlier, according to a new report.
Mortgage lending fell to €2 billion in the three months through March from €6.27 billion a year earlier, according the most recent IBF/PwC Mortgage Market Profile.
Over 37 per cent of new loans issued were “top-ups” and these were the largest segment in the mortgage market.
The volume of home loans dropped 61 per cent, the report said as falling property prices, rising unemployment and tighter lending criteria rules deterred buyers.
In the first three months of the year 10,997 loans were drawn down, 61.4 per cent less than the first quarter 2008.
The report found that the rate of decline was lower among first-time buyers that other segments of the market and they increased their share of the market for the fourth successive quarter. They now account for 21.4 per cent of loans drawn down.
House prices slipped 1 per cent in March, extending a slump that has seen average prices fall to their lowest level in four years, according to Irish Life & Permanent.
“The general economic environment continues to be very challenging,” IBF chief executive Pat Farrell said in a statement.
However, he said there were “tentative signs of a pick-up in the level of applications”.
