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Description

Description

Covered in this report

New mortgage loans issued between 2018 and 2019 increased. However, total outstanding mortgage debt for IoI declined, highlighting that while more consumers are seeking to buy a property, many still are making concerted efforts to reduce mortgage debt. While Brexit may have caused some (particularly in NI) to pause for thought when considering a new mortgage, future demand for housing is likely to drive the mortgage market forward.

“Both NI and RoI have seen an increase in new mortgage approvals between 2018 and 2019 despite any concerns the Brexit might be causing Irish consumers when taking out a mortgage. Moving forward, the market seems set to continue to grow and demand for housing increases.”
– Brian O’Connor, Senior Consumer Analyst

What's included

What's included

Table of contents

Table of contents

  1. Overview

    • What you need to know
      • Issues covered in this Report
      • Executive Summary

          • The market
            • Figure 1: Value of outstanding mortgage debt, actual, estimated, forecasted and projected, 2015-19
          • Forecast
            • Figure 2: Indexed value of outstanding mortgage debt, actual, estimated, forecasted and projected, 2015-19
          • Market factors
            • Strong employment helping to sustain mortgage activity
              • NI consumers personal financial situation deteriorated somewhat 2016-20
                • Average house prices continued to increase in 2019
                  • Fewer homeowners in arrears in 2019
                    • Companies and innovations
                      • The consumer
                        • One in three holds a mortgage
                          • Figure 3: Consumers who, either on their own or with their partner, currently have a mortgage on the property they live in as their main home, NI and RoI, January 2020
                          • Figure 4: Type of mortgage currently held, NI and RoI, January 2020
                        • Preference for long-term fixed rate mortgages
                          • Figure 5: When mortgage holders current deal will end, NI and RoI, January 2020
                          • Figure 6: When mortgage holders current deal will end, by age group, NI and RoI, January 2020
                        • RoI consumers more likely to apply for a mortgage in 2020
                          • Figure 7: Whether consumers are considering applying for a mortgage or a re-mortgage within the next 12 months, NI and RoI, January 2020
                        • Over half of RoI consumers seek longer term mortgages
                          • Figure 8: Agreement with statements relating to mortgage behaviour, NI and RoI, January 2020
                        • RoI consumers more likely to fear mortgage rejection
                          • Figure 9: Agreement with statements relating to mortgages and mortgages providers, January 2020
                      • The Market – What You Need to Know

                        • Outstanding mortgage value falls despite
                          • Strong employment helping to sustain mortgage activity
                            • Consumers still likely to rate their finances as ‘OK’
                              • House prices continue to increase
                                • 2019 sees fewer arrears, repossession and restructures
                                • Market Size and Forecast

                                    • Outstanding mortgage debt falls despite increase in mortgage approvals
                                      • Figure 10: Value of outstanding mortgage debt, actual, estimated, forecasted, and projected, 2015-24
                                    • RoI approval rates increase despite stringent lending criteria
                                      • Figure 11: Mortgage approvals, by type of mortgage, RoI, 2015-19
                                      • Figure 12: Mortgage approvals, by type of mortgage, RoI, 2019
                                      • Figure 13: Average mortgage loan value, RoI, Q1 2015 to Q3 2019
                                    • FTB mortgages in NI continue to grow
                                      • Figure 14: Number of new mortgage loans, NI, 2016-19
                                      • Figure 15: Average mortgage loan value, RoI, Q1 2015 to Q3 2019
                                    • Steady growth in near future
                                      • Figure 16: Value of outstanding mortgage debt, actual, estimated, forecasted and projected, 2015-24
                                  • Market Drivers

                                    • Employment levels continue to grow
                                      • Figure 17: Indexed employment rates, NI and RoI, Q1 2014 to Q3 2019*
                                    • Employment rates set to slow in 2020
                                      • Figure 18: Job growth forecast, NI and RoI, 2019-23
                                      • Figure 19: What effect consumers think Brexit will have on unemployment, NI and RoI, June 2019
                                    • Consumers still likely to rate their finances as ‘OK’
                                      • Figure 20: Financial health of Irish consumers, NI and RoI, 2016-20
                                    • House prices continue to increase despite Brexit concerns
                                      • Figure 21: Average national house price (at first listing), RoI, January 2013-October 2019
                                    • NI housing prices continue apace
                                      • Figure 22: Average national house price (at first listing), NI, Q1 2013-Q3 2019
                                    • Arrears, repossessions and restructures in decline
                                      • Figure 23: Number of mortgage accounts in arrears, repossessions and mortgage restructures for principal dwelling households, RoI, 2015-19
                                    • Low levels of savings may prove problematic for some
                                      • Figure 24: Amount that consumers currently have in savings and investments (excluding the value of main home and any pension savings), NI and RoI, November 2019
                                    • Interest rates for RoI mortgages high compared to rest of EU
                                      • Figure 25: Retail interest rates for loans for house purchases with original maturity, RoI, January 2014 to October 2019
                                  • Companies and Brands – What you need to know

                                    • Progressive allow customers to pay mortgages in foreign currency
                                      • AIB encouraging climate considerations
                                        • Reaching out to LGTBQ couples seeking mortgages
                                        • Who’s Innovating?

                                            • Progressive Building Society introduces Foreign Currency Mortgage
                                              • AIB RoI introduce a Green Mortgage
                                                  • Figure 26: Eco and ethical activities consumers regularly do, NI and RoI, November 2018
                                                • Helping LGBTQ+ couples get on the property ladder
                                                • Companies and Brands

                                                    • Allied Irish Bank/First Trust (AIB NI)
                                                      • Key facts
                                                        • Product portfolio
                                                          • Recent developments
                                                            • Bank of Ireland
                                                              • Key facts
                                                                • Product portfolio
                                                                  • Recent developments
                                                                    • Danske Bank
                                                                      • Key facts
                                                                        • Product portfolio
                                                                          • Recent developments
                                                                            • Halifax
                                                                              • Key facts
                                                                                • Product portfolio
                                                                                  • Recent developments
                                                                                    • HSBC
                                                                                      • Key facts
                                                                                        • Product portfolio
                                                                                          • Recent Developments
                                                                                            • KBC Ireland
                                                                                              • Key facts
                                                                                                • Product portfolio
                                                                                                  • Recent developments
                                                                                                    • Nationwide
                                                                                                      • Key facts
                                                                                                        • Product portfolio
                                                                                                          • Recent developments
                                                                                                            • Permanent TSB
                                                                                                              • Key facts
                                                                                                                • Product portfolio
                                                                                                                  • Recent developments
                                                                                                                    • Progressive Building Society
                                                                                                                      • Key facts
                                                                                                                        • Product portfolio
                                                                                                                          • Recent developments
                                                                                                                            • Santander
                                                                                                                              • Key facts
                                                                                                                                • Product portfolio
                                                                                                                                  • Recent developments
                                                                                                                                    • Ulster Bank
                                                                                                                                      • Key facts
                                                                                                                                        • Product portfolio
                                                                                                                                          • Recent developments
                                                                                                                                          • The Consumer – What You Need to Know

                                                                                                                                            • One third of consumers have an outstanding mortgage
                                                                                                                                              • Preference for long-term fixed rate mortgages
                                                                                                                                                • RoI consumers more likely to apply for a mortgage in 2020
                                                                                                                                                  • Online functionality used to check mortgage status
                                                                                                                                                    • Four in 10 non-mortgage holders claim to have more important saving intentions than property
                                                                                                                                                    • Ownership and Type of Mortgages

                                                                                                                                                        • Over a third of Irish consumers have a mortgage
                                                                                                                                                          • Figure 27: Consumers who, either on their own or with their partner, currently have a mortgage on the property they live in as their main home, NI and RoI, January 2020
                                                                                                                                                        • 35-54 year olds key mortgage holders
                                                                                                                                                          • Figure 28: Consumers who, either on their own or with their partner, currently have a mortgage on the property they live in as their main home, by age group, NI and RoI, January 2020
                                                                                                                                                          • Figure 29: Household income levels, by age group, NI and RoI, January 2020
                                                                                                                                                          • Figure 30: Consumers who, either on their own or with their partner, currently have a mortgage on the property they live in as their main home, by socio-economic group, NI and RoI, January 2020
                                                                                                                                                        • Fixed rate mortgages the preference among NI and RoI mortgage holders
                                                                                                                                                          • Figure 31: Type of mortgage currently held, NI and RoI, January 2020
                                                                                                                                                        • Tracker mortgages more likely to be held by men
                                                                                                                                                          • Figure 32: Fixed rate vs tracker mortgage ownership, by gender, NI and RoI, January 2020
                                                                                                                                                          • Figure 33: How consumers rate their current financial situation, by gender, January 2020
                                                                                                                                                      • Current Mortgage Deal Term and Intentions

                                                                                                                                                          • Irish mortgage holders prefer long term deals
                                                                                                                                                            • Figure 34: When mortgage holders current deal will end, NI and RoI, January 2020
                                                                                                                                                          • Mature consumers more inclined to opt for long term deal
                                                                                                                                                            • Figure 35: When mortgage holders current deal will end, by age group, NI and RoI, January 2020
                                                                                                                                                          • Most seek new deals with current providers
                                                                                                                                                            • Figure 36: When mortgage holders current deal will end, by age group, NI and RoI, January 2020
                                                                                                                                                        • Future Mortgage Intentions

                                                                                                                                                            • RoI consumers show greater future willingness to apply for mortgage
                                                                                                                                                              • Figure 37: Whether consumers are considering applying for a mortgage or a re-mortgage within the next 12 months, NI and RoI, January 2020
                                                                                                                                                              • Figure 38: Consumers who are not planning to apply for a mortgage in the next 12 months, by age group, NI and RoI, January 2020
                                                                                                                                                              • Figure 39: Actual and projected population (%) for NI, by age, 2017 and 2041
                                                                                                                                                              • Figure 40: Actual and projected population (%) for RoI, by age, 2017 and 2046
                                                                                                                                                          • Mortgage Behaviours

                                                                                                                                                              • Mortgage holder frequently check mortgage statements online
                                                                                                                                                                • Figure 41: Agreement with statements relating to mortgage behaviour, NI and RoI, January 2020
                                                                                                                                                              • Online statement checking strongest among younger consumers
                                                                                                                                                                • Figure 42: Agreement with the statement ‘I regularly check my mortgage statement online’, by age group, NI and RoI, January 2020
                                                                                                                                                                • Figure 43: Agreement with statement, ‘I prefer visiting branches for important financial issues (eg to arrange a mortgage/loan)’, by age and daily internet usage, NI and RoI, April 2017
                                                                                                                                                              • Higher house prices see RoI consumers more likely to want a longer term
                                                                                                                                                                • Figure 44: Agreement with statement, ‘I opted for a longer mortgage term to lower my monthly costs’, by socio-economic group, NI and RoI, January 2020
                                                                                                                                                              • Greater positivity sees RoI consumers more willing to make additional borrowing in near future
                                                                                                                                                                • Figure 45: Agreement with statement, ‘I am planning to borrow additional funds in the next 12 months’, NI and RoI, January 2020
                                                                                                                                                                • Figure 46: How consumers expect their personal financial situation to change in the next 12 months, NI and RoI, January 2020
                                                                                                                                                            • Mortgage Intentions for Non-Mortgage Holders

                                                                                                                                                                • Four in 10 have better things to save for
                                                                                                                                                                  • Figure 47: Agreement with statements relating to mortgages and mortgages providers, December 2018
                                                                                                                                                                • Desire to buy a home varies with lifestage
                                                                                                                                                                  • Figure 48: Agreement with the statement ‘I have better things to save for than a property’, by generation, NI and RoI, January 2020
                                                                                                                                                                • RoI consumers show greater fear of rejection
                                                                                                                                                                  • Figure 49: Agreement with the statement ‘I think if I applied for a mortgage now, I would be rejected’, by gender and financial situation, NI and RoI, January 2020
                                                                                                                                                                • RoI consumers more likely to note buying a home is a priority for them
                                                                                                                                                                  • Figure 50: Agreement with the statement ‘Buying a home is a priority for me’, by area, NI and RoI, January 2020
                                                                                                                                                                  • Figure 51: Agreement with the statement ‘I am actively saving for a deposit to buy a house’, NI and RoI, January 2020
                                                                                                                                                              • Appendix – Data Sources, Abbreviations and Supporting Information

                                                                                                                                                                • Data sources
                                                                                                                                                                  • Generational cohort definitions
                                                                                                                                                                    • Abbreviations

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