New data from the Banking and Payments Federation, shows that mortgage approvals for house purchases were €447m in May, up 12.0% on the year. This compares with 60% annual growth recorded in the first quarter of 2015.
Furthermore, the data suggests that the slowdown in mortgage lending has continued into May. There were €447m mortgage approvals for house purchase in May, up from €391m in April. However, this means mortgage approvals are only up 12% on the year compared with 56% annual growth in 2014 and 60% in the first quarter of 2015. There were 2,347 approvals in May, up 7.4% on the year. The average loan approval in May was €190,456, down from €195,658 in the first quarter.
According to Davy Stockbrokers, “Overall, the sharp slowdown in mortgage approvals in Q2 2015 suggests that there are downside risks to our €4.5bn forecast for mortgage lending.
However, it is not yet clear if the slowdown in Q2 is temporary after an exceptionally strong first quarter. Residential property market transactions were still up 33.7% in April. That said, the full impact of the limits on high LTV and Loan-to-Income (LTI) mortgages on actual lending is not yet clear.”
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