New figures from Banking and Payments Federation Ireland show that the monthly growth trend in the number of approved mortgages continued in August, while they continued to be lower on an annual basis.

The BPFI figures show that a total of 3,875 mortgages were approved in August. This marked an increase of 14.1% from July but a fall of 11% compared to the same time last year.

First-time buyers were approved for 2,259 mortgages - 58% of the total volume - while mover purchasers accounted for 1,000 (26%) in August, the BPFI noted.

Mortgages approved in August 2020 were valued at €946m, of which first time buyers accounted for €556m (59%) and mover purchasers for €267m (28%).

The value of mortgage approvals rose by 16.7% on a monthly basis but were down by 2.3% on an annual basis.

Dr Ali Ugur, BPFI's chief economist, said that after a strong uplift in mortgage approval activity in July compared to the previous month, this increase in August provides a much improved pipeline for mortgage drawdown activity in the months ahead, despite the fact that overall activity is still down year on year.

Dr Ugur noted that actual mortgage drawdowns were down by around 18% year-on-year in the first half of 2020, adding that this was not a surprise in light of Covid-19. 

"But, if recent approvals convert into drawdowns as they normally do, we could expect to see a better outcome than originally estimated back in April/May," he said.

"It's also interesting to note that when we compare first-time buyer mortgage approvals in August 2020 to the same period last year, there was a higher number both in terms of value and volume. Given that 58% of all approvals are to FTBs, we could expect to see that important category continue to be the single largest element of the market," he added.