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Northern Ireland mortgage market continues to show steady growth in house purchase activity

THERE were 2,700 new first-time buyer mortgages completed in Northern Ireland in the third quarter of 2018 – some 3.8 per cent more than in the same quarter of 2017, data from UK Finance has revealed.

The £280,000 of new lending was 7.7 per cent more year-on-year, the report said, adding that the average Northern Ireland first-time buyer is 30 and has a gross household income of £33,000.

There were 1,800 new home-mover mortgages completed in the north in the third quarter, 5.9 per cent more than last year and worth £240,000

Derek Wilson, chair of UK Finance’s regional mortgage committee, said: “The Northern Ireland mortgage market continues to show steady growth in house purchase activity.

“Lending to first-time buyers remains the largest sector by value, as borrowers take advantage of what continues to be the most affordable region in the UK.

“These figures underline the importance of boosting housing supply to meet this growing demand.”

Patrick Mullan, head of mortgages at Danske Bank, said: “The latest survey shows the market continues to grow steadily, with mortgage activity for first-time buyers, home movers and remortgagers in Northern Ireland all showing healthy increases from the same quarter last year, despite consumer confidence having been dented by ongoing uncertainty around the economic and political outlook.

“This consistent growth has been reflected in our own figures, which showed a 29 per cent uplift in new to bank mortgage lending across all borrower types in the third quarter when compared with a year ago.

“The first-time buyer market continues to demonstrate sustained growth and is the largest sector by value, with activity in the quarter up 3.8 per cent year on year.

“The strength of the first-time buyer market is also mirrored in Danske Bank’s own figures, with the bank now lending to one in four of all first-time buyers in Northern Ireland.

“The competitive deals on offer from many lenders and house-builders continuing to invest in new housing stock, could help explain the sustained growth in the first-time buyer market.”

He added: “While the Bank of England has said it will only raise interest rates very gradually, there is an expectation rates will increase at some point in 2019, which may drive further demand for fixed rate mortgages.

“We are seeing more people take out fixed rate mortgages, with increased demand for five-year fixed mortgages rather than shorter two-year deals, which may also be influenced by the current uncertainty around the possible impact of Brexit on the economy.

“There has been a steady increase in the number and value of home-owner remortgages compared with the same quarter last year, but we believe there is still room for further growth in this segment of the market into next year.

“In general, this survey indicates the housing market in Northern Ireland is still growing. We are still the UK’s most affordable region, so even as house prices continue to rise, these increases are reasonable and there is capacity for further sustainable growth going forward.”

Source: Irish News