New mortgage lending fell by 52.2 per cent in the second quarter of the year, as the value of the average new mortgage fell to less than €200,000 for the first time since 2005.

More than three-quarters of all mortgage credit issued now goes to either first-time buyers or those trading up.

According to the Irish Bankers Federation (IBF)/PwC market profile for the second quarter of this year, the total value of mortgages fell by more than 50 per cent compared to the same period in 2010, down to €624 million. The number of mortgages issued also experienced a significant decline, down by 54.6 per cent to 3,551 mortgages.

However, there was a slight lift in the market compared to the first three months of the year, as the value of mortgages rose by 8.1 per cent, and the number by 9 per cent in the second quarter, due to seasonal patterns.

"Current mortgage market activity reflects the general macroeconomic environment. In these challenging times manageable borrowing and prudent lending are to be expected," said Pat Farrell, chief executive of the IBF.

First-time buyers remain the largest segment of the market, at 42 per cent, while mover buyers accounted for 28.1 per cent in the second quarter. When combined, first time buyers and those trading up now account for 78 per cent of the market by value, and 70 per cent by volume.

Residential investment remained low with a 4 per cent market share by volume.