Mortgage lending hits post-crisis high as first-time buyers dominate heading into 2026
Almost €14.5bn drawn down in 2025 as switching activity rises and movers fall back
28 January 2026 | 📧 editor@ipropertyradio.com
Mortgage lending in Ireland reached its highest level since the financial crisis in 2025, with almost €14.5 billion worth of home loans drawn down, according to the latest data from Banking & Payments Federation Ireland (BPFI). The figures point to sustained demand from first-time buyers, rising switching activity among existing borrowers, and continued pressure on housing supply as Ireland moves into 2026. Mortgage-Approvals-Report-Decem…
A total of 46,358 mortgages were drawn down during 2025, up 7.7 per cent on the previous year, while the value of lending rose by 15.2 per cent year-on-year. This marks the highest annual drawdown value since 2008. First-time buyers continued to underpin the market, accounting for 60 per cent of mortgage volumes and 61 per cent of total value, with 27,652 loans drawn down by FTBs during the year.
For households looking to buy their first home in 2026, the data confirms that competition remains strongest in the first-time buyer segment. The total value of FTB drawdowns exceeded €8.8 billion in 2025, the highest level on record, reflecting both higher house prices and larger average loan sizes.
By contrast, mover purchase mortgages moved against the broader trend. Volumes fell to 8,782 loans in 2025, the lowest level since 2014. This suggests many existing homeowners are choosing to stay put, a dynamic that continues to constrain the supply of second-hand homes coming to the market.
One of the clearest structural shifts in the data is the growing reliance of first-time buyers on new homes. New properties, including self-builds, accounted for 41 per cent of FTB mortgage volumes and 43 per cent of values in 2025, the highest share since 2009. In total, 11,343 FTB mortgages were drawn down on new homes, valued at more than €3.8 billion. While fewer first-time buyers purchased second-hand homes for the second year in a row, the value of those loans still exceeded €5 billion for the first time.
For existing mortgage holders, the figures point to strong momentum in switching and refinancing. Re-mortgage and switching drawdowns rose sharply during 2025, with values increasing by more than 50 per cent year-on-year to almost €1.7 billion, the second-highest level since 2008. This reflects ongoing borrower engagement with rates and products following ECB interest rate changes. Top-up lending also increased, with 3,280 top-up drawdowns worth €463 million, the highest level since 2010.
Looking at approvals, which provide a forward indicator for 2026, lenders approved 53,264 mortgages during 2025, valued at more than €16.9 billion. Approval volumes rose by 3.8 per cent year-on-year, while values increased by 10.3 per cent, the highest annual approval value since the series began in 2011. December 2025 saw a seasonal slowdown, with 3,504 approvals issued, down month-on-month but slightly higher in value compared with December 2024.
For consumers planning to buy in 2026, the approvals data indicates that demand remains robust, particularly among first-time buyers, who made up almost 60 per cent of approvals in December. However, the continued weakness in mover activity and low housing commencements point to ongoing supply constraints, particularly beyond 2026.
BPFI chief executive Brian Hayes said the outlook for mortgage demand remains strong but warned that housing output will need to accelerate to sustain lending levels in future years. While completions in 2026 look more positive, commencements in 2025 fell to around 16,500 units, half the level seen in 2023.
For mortgage holders, the data underlines the importance of reviewing rates and options as switching activity remains elevated. For prospective buyers, particularly first-time buyers, the figures confirm that access to new-build supply and competition within the FTB cohort will continue to shape affordability and borrowing decisions through 2026.
