The value of mortgage approvals in 2020 exceeded €10 billion, despite a slump in lending in the early months of the pandemic.
This is according to figures for the final quarter of 2020 and the full year from Banking and Payments Federation of Ireland.
A rebound in activity in the final quarter of the year accounted for much of the improvement in performance for the year.
The figures show that a total of 43,151 mortgages were approved in the year to a total value of €10.34 billion.
When it comes to mortgages drawn down, the total for the year was 35,617 with the value exceeding €8.36 billion, representing the lowest level of activity in three years.
However, there was a surge in mortgage drawdown activity towards the end of the year, the figures show.
12,154 new mortgages to the value of €2.95 billion were drawn down by borrowers during the final three months of 2020.
While it represented a marginal fall in volume and value on the corresponding fourth quarter of 2019, when compared to the previous three months of 2020, the figures showed an increase in volume and value terms of around 50%.
First-time buyers remained the single largest segment accounting for well over half of activity by volume and value.
"During the final quarter of 2020, we recorded the highest value of drawdowns since the fourth quarter of 2008," Brian Hayes, CEO of BPFI said.
"While the recovery in mortgage activity in recent months has not fully offset the sharp decline we saw earlier in 2020 due to Covid-19 restrictions, the continued strong performance of approvals suggests that there is a good pipeline for drawdowns in the first and second quarter of this year," he said.
"It remains to be seen however the impact the current lockdown we are experiencing will have on prospective homebuyers and the mortgage market as we move beyond that," he added.
Dermot O'Leary, chief economist with Goodbody, said the better than expected outcome had prompted the group to upgrade its outlook for the mortgage market for this year and next.
"The combination of this better outturn and the stronger momentum in approvals leads us to upgrade our forecast to €9.7 billion - up from €9 billion previously - for 2021 and to €10.8 billion in 2022 from €10.3 billion previously.
"This would imply that the mortgage market will be bigger in 2021 than it was in 2019," he said.
Conall Mac Coille, chief economist with Davy, said the figures showed that there had been no tightening of mortgage availability, with banks now making up for lost time.
"Comments from Minister for Finance Paschal Donohoe yesterday that restrictions may be eased gradually in March, hopefully indicate residential transactions can resume quickly in early 2021," he said.
However, he pointed to the shortage of availability of homes on the market at the moment as one factor potentially restricting activity.
"There are now just 12,200 properties listed for sale on myhome.ie, with existing stock being sold, but new listings impaired by business restrictions.
"While time is being lost, estate agents may be able to list new stock quickly once restrictions are lifted and the first quarter of the year is the quietest quarter for mortgage lending in any case," he added.