In an article in today’s Irish Examiner the Association of Expert Mortgage Advisers (AEMA) estimate the Irish mortgage market should be operating at c. €10bn in 2014, compared to the €3-4bn anticipated. The AEMA base their forecast on historical factors and demographics, pointing out that this optimum level is still just a quarter of the peak Irish mortgage market (c. €36bn) in 2007. The mortgage advisors believe most of the mortgage demand in 2014 will come from first-time buyers (FTB) and borrowers seeking to trade up to larger family homes. They also note that the professional landlord is returning with a rise in the number of home owners seeking remortgages to invest in buy-to-let properties. <p>
While we would agree with the AEMA that current mortgage lending levels are unsustainable to support a normalised housing market, we note that a significant amount of purchases are being funded by cash buyers at present (estimated to be c. 50%). It remains to be seen how long this cash bid will persist, though anecdotally an increasing number of international investors appear to be acquiring Irish residential properties, attracted by the low valuations and high yields.
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