First-time buyers looking further afield for homes amid stiff competition, BPFI research says

First-time homebuyers are increasingly looking further afield to find a property amid fierce competition for houses and the flexibility of working-from-home in the post-Covid era, new research from the Banking and Payments Federation of Ireland (BPFI) has indicated.

In its latest profile of the mortgage market covering the second half of last year, the bank lobby group said some 26,000 first-time buyer mortgages were drawn down in 2023 with a total value of €7.2 billion. This represented a 1.6 per cent increase in the number of home loan drawdowns to the highest level since the peak of the property boom in 2007.

The analysis highlights the growing proportion of first-time buyers who are borrowing to fund property purchases outside of their native or home counties.

“While 31.3 per cent of FTB (first-time buyer) mortgages in 2023 were secured on properties in Dublin, borrowers from Dublin accounted for 40.4 per cent of FTB mortgages issued,” the BPFI said in the report. “By contrast, Kildare, Meath and Wicklow each had higher shares of mortgage properties than mortgage borrowers. This implies that borrowers from Dublin have been securing properties in other counties while the bordering counties have seen an influx of borrowers from elsewhere, most likely Dublin.”

They’re tax efficient – but should you invest in trusts?

---

Should we invest in retrofitting our home as pensioners?

---

Summer of sport an open goal for Europe’s pub and travel trade

---

Mixed data on health of China’s economy

---

Nearly a quarter of all first-time buyers borrowed against a property in a different county last year, the BPFI said. While the proportion is relatively modest, it has increased from 19 per cent in 2021 with the phenomenon most evident in Leinster, where the first-time buyer’s share of the mortgage market has increased by at least ten percentage points in nine counties, it said.

Dublin, however, remained the largest mortgage market, accounting for 31.3 per cent of home purchase mortgages with Cork next at 11.7 per cent and Kildare with 8.3 per cent

Brian Hayes, chief executive of the BPFI, said the trend is illustrative of the level of competition between buyers in the market amid strong demand and low supply, “with this cohort looking further afield and becoming more willing to move county to buy their first home”. He said: “In addition, more than one in five of the workforce in Ireland is now working from home on a regular basis, according to latest Eurostat figures, giving buyers more flexibility on where to choose a home.

“The trend is most significant in Leinster and particularly with Dublin borrowers who accounted for a tenth of FTB mortgages in eleven other counties in 2023, from Cavan in the north to Wexford in the south and over 40 per cent of FTB mortgages in Kildare, Wicklow and Meath.”

Dublin, however, remained the largest mortgage market, accounting for 31.3 per cent of home purchase mortgages with Cork next at 11.7 per cent and Kildare with 8.3 per cent.

In Limerick, some 60 per cent of mortgages were FTB mortgages on existing property, the BPFI said, making it the county with the largest share of home mortgages going to FTBs buying existing property.

• Sign up for Business push alerts and have the best news, analysis and comment delivered directly to your phone
• Join The Irish Times on WhatsApp and stay up to date
• Our Inside Business podcast is published weekly – Find the latest episode here