Irish mortgage lending falling off a cliff....

banjobater · **Joined:** Oct 2, 2007 **Posts:** 261

For those who are in any doubt as to the severity of the property crash we are in the middle of, here are some graphs I put together based on recently updated Irish Banking Federation mortgage draw-down data:

BoyRacer · **Joined:** Jul 26, 2009 **Posts:** 10080

Based on the above graph the top of the market in terms of volume of transactions and value the top of the property market in Ireland occurred in Spring 2006. The developers may have realised this at the time and hence the last surge in employment in construction and also immigration during 2007 as they rushed to complete existing projects. I believe the number of planning applications also started to fall in 2006, so people were beginning to realise the game was up by then and daftwatch shows an increasing supply of property for sale from then on, does anyone know what the trend had been before that?

2Pack · **Joined:** May 3, 2007 **Posts:** 10508

Mortgage lending was €40bn a year or so in 2005 and 2006 , €30bn in annual liquidity injections have been removed from a €150bn economy since that time ...which rather is a lot . Interior decoration ain't what it was..just ask Izzy .

Most of this decline has already occured you will be glad to hear meaning there will be a bettering in the pace of worsening from now on .

It will not uptick until 2012 and then only anorexicly.

( incorrect assertion removed)

needle · **Joined:** Jan 18, 2009 **Posts:** 2550 **Location:** NWUK

2Pack wrote:

..... you will be glad to hear meaning there will be a bettering in the pace of worsening from now on .

Au contraire!
This is exactly what happened in the UK and we have since been hit with tsunami of 'house prices rising' stories.
So volumes have collapsed (rarely mentioned) but the 'average price' has risen as a result.

I would expect a full throathed media campaign to show house prices 'rising' again in the next 6 months.
This aint over by a long shot Pinsters.

superman · **Joined:** Jan 25, 2007 **Posts:** 1322

2Pack wrote:

€30bn in annual liquidity injections have been removed from a €150bn economy

What will it be like when the government removes an extra €25 bn or so?

Blindjustice BATONEFFECT · **Posted:** Sat Nov 14, 2009 2:32 pm

superman wrote:

2Pack wrote:

€30bn in annual liquidity injections have been removed from a €150bn economy

What will it be like when the government removes an extra €25 bn or so?

Remember that scene in Trainspotting....I just need one more ******* hit!

grumpy · **Joined:** Jun 9, 2008 **Posts:** 5059

2Pack wrote:

I predicted sub €10bn mortgage lending and the consequences thereof on the PIN some years ago so this is all most unsurprising .

It was €40bn a year or so in 2005 and 2006 , €30bn in annual liquidity injections have been removed from a €150bn economy since that time ...which rather is a lot . Interior decoration ain't what it was..just ask Izzy .

Most of this decline has already occured you will be glad to hear meaning there will be a bettering in the pace of worsening from now on .

It will not uptick until 2012 and then only anorexicly.

Are you pushing your view of the timing of the bottom out a bit?

BoyRacer · **Joined:** Jul 26, 2009 **Posts:** 10080

New Irish mortgages issued down 56.4% in Q3 2009; AIB says it financed 40% of all residential property transactions in quarter -> http://www.finfacts.ie/irishfinancenews ... 8422.shtml

Quote:

The IBF/PwC report on the Irish mortgage market published today shows that 12,189 new mortgages to the value of some €2.1 billion were issued during the third quarter of 2009 down 56.4% from 27,937, in the same quarter in 2008. Meanwhile, AIB today announced that it provided finance for 40% of all residential property transactions in the third quarter of 2009.
..
..
..
Marian McCarville, Head of Credit Products, AIB Bank said: “While the demand for mortgage finance is still well below the levels seen in 2007 and 2008, AIB is continuing to see a steady flow of good quality mortgage applications from both first time buyers and those moving home. We have also seen a shift in the type of property that first time buyers are looking to buy in 2009 with sanction requests for second hand homes now the most popular category at 57%.
“We are committed to continuing our strong support of the mortgage market and in particular for first time buyers.”

there is more

2Pack · **Joined:** May 3, 2007 **Posts:** 10508

Actually Grumpy I can't find that assertion so you are most probably right ( post edited) , I may have done so elsewhere

I predicted 2008 @ €25bn ( in 2007) here

viewtopic.php?f=4&t=5215&hilit=+budget+2008

Quote:

Because of all this I now predict that Mortgage lending ( including topups and remortgages) will drop to €25Bn next year from €40Bn in 2006.

Thats €15bn the banks will not be sloshing around the economy for starters .

viewtopic.php?f=4&t=16420&hilit=how+hard+is+it

I revisited that late 2008 in a year when when the actual outturn was c.€23Bn and predicted max €12bn in 2009 it looks like €8.5bn will be the final number.

Quote:

Well the mortgage market next year will halve again ( including homechoice) ,to €12bn at the very most.

I am dubious at to whether that has been factored in to the current 2009 budget but it may make it into the emergency budget in Feb/March

The good news

is that 2010 is the FIRST year in a long time where I am not predicting a halving or so in Mortgage lending .

I now predict that Mortgage Lending in Ireland in 2010 will be around €6bn , in total .

yoganmahew · **Posted:** Sun Nov 15, 2009 5:10 pm

2Pack wrote:

Actually Grumpy I can't find that assertion so you are most probably right ( post edited) , I may have done so elsewhere

I remember reading it and I didn't wade through the AAM thread, so it must have been on here. Some time about the collapse of Northern Rock, as I recall.

edit: though as I recall aswell it was for 2009 that you were calling it. Still, correct in the trend, correct in the effect...

2Pack · **Joined:** May 3, 2007 **Posts:** 10508

I can't prove it Yogan , I can only prove I predicted the following years trends reasonably accurately in advance ....which is more than all the dept of Finance and Central bank could manage in fairness . I did hint at the 2009 out turn as early as April 2008 here where I pointed out the 2009 mortgage market ( less remortgages was likely to be sub €10bn . It will be sub €10bn including remortgages .

ps200306 · **Joined:** Apr 1, 2010 **Posts:** 3745

Latest IBF/PWC report (Q4 '10):

http://www.ibf.ie/Libraries/Research_St ... .sflb.ashx

Mortgage volume down 43.5% Q4 '10 compared to Q4 '09, and down 22% compared to Q3 '2010. 40% fewer for all of 2010 compared to all of 2009.

FTB and movers down just over 20%, while buy-to-let down over 50%.

FAUGH45568 · **Joined:** Jun 5, 2008 **Posts:** 1485

thanks ps
Quick drive by...

Quote:

Although all five segments contracted in the fourth quarter, first-time buyers (FTBs) and mover-purchasers showed continued comparative resilience.

Known as dumb money to me anyway..

Quote:

Mortgage loans to the RIL and top-up segments increased in the fourth quarter – the first time both segments have increased since Q2 2008.

devil is in the detail...

Quote:

Mortgage loans to the RIL

238
Falling off a cliff seems appropriate here..
When you are that low be prepared for some higher figures, probability favours it does not but heh, stranger things have happened.

Saibhreas · **Joined:** Jan 17, 2008 **Posts:** 132

I read that as fell of a cliff, rather than falling...

Until more data points are provided within 2009 and onwards

BottomsUp · **Joined:** Apr 19, 2010 **Posts:** 1375

http://www.irishtimes.com/newspaper/fin ... 79999.html

Quote:

Mortgage loans fell 22.5% in Q4 of 2010

THE MORTGAGE market in Ireland continues to weaken with the volume of new lending in the final quarter of last year, falling 22.5 per cent on the previous quarter and 43.5 per cent on the same period in 2009...

...Rachel Doyle, director of PIBA Mortgage Services, accused the State’s banks of “imposing very unrealistic criteria as a form of refusal” and said first-time buyers were struggling to get approval.

“We know there is a demand in the market from first-time buyers in particular. However, they, along with self-employed people, are the two groups who are having greatest difficulty in securing loans at a time when affordability is at an all-time low,” she said

There is more.

Just who do these banks think they are, don't they know that these FTB's are entitled to get a mortgage.

"affordability is at an all-time low", no, it was at an all time low in 2006, but it's getting better ;-)

Irish mortgage lending falling off a cliff....

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