Over 100% increase in people applying to switch mortgage providers

The amount of people looking to change mortgage provider to secure a lower interest rate has increased by over 100 per cent.

The surge in people switching mortgage providers has come after the the European Central Bank announced a series of interest rate hikes, with more expected to be on the way. 

A total of 1,910 mortgage holders got approval in October to move their home loan, an increase of 124.4% in the past year, latest figures from the Banking and Payments Federation show.

19% of new mortgage approvals last month were for people looking to switch.

Close to €1.5 billion in new mortgages were approved in October, the figures also show.

The Banking and Payments Federation of Ireland says mortgages approved in October were valued at €1,462 million.

2,363 mortgage approvals for first-time buyers accounted for €633 million of new approvals last month. Approvals for first-time buyers were at their lowest level for October, since 2019.

Mover-purchasers accounted for €320 million worth of approvals.

Speaking on the publication of the data, Brian Hayes, Chief Executive, BPFI stated: "Our latest mortgage data is showing continued growth in mortgage activity driven solely by a sharp increase in non-purchase mortgages, mainly switching. For the first time since 2011, non-purchase mortgages accounted for more than one third of both the volume (35.7%) and the value (34%) of monthly approvals with the volume of those non-purchase mortgages increasing to their second highest level since the data series began (after June 2022).

"It is clear that customers are actively managing their mortgages by seeking out new deals to minimise the impact of ECB interest rate decisions and this is further evidenced by separate data from the Central Bank of Ireland which shows that the value of mortgages renegotiated on fixed-rate terms more than trebled between Q3 2021 and Q3 2022 to €1.7 billion.

"In contrast, FTB approval volumes were the lowest for October since 2019.  Looking at the annualised figures which allows us to more accurately assess emerging key trends, both FTB and mover purchase approval volumes in the twelve months ending October 2022 were the lowest since the twelve months ending May 2021, with activity returning to pre-Covid levels. However, in value terms, FTB approvals remained close to the peak of €7.7 billion (August 2022), reflecting the sharp increase in housing prices since 2021," Mr Hayes said.