And January is supposed to be a quiet month...

THE strong rise in the number of people getting the all-clear from their banks to borrow to buy a home indicates that the mortgage market may be getting back to some sort of normality.

And this return to more typical lending patterns is taking place sooner than had been expected.

January saw a surge in borrowing for bricks and mortar. But this was hardly surprising given that two big policy changes took effect in that month.

The Government’s tax rebate came into operation in January, and less restrictive lending rules for first-time buyers took effect at the same time. These changes helped push up the numbers getting approved by banks and other lenders to borrow to buy a home.

There was a 47pc increase in the numbers approved for a mortgage in January, compared with the same month last year, according to figures from the Banking and Payments Federation.

Generally a very slow month in the housing market, this January turned out to be a barnstorming one.

The figures show €513m in loans was approved for house purchase in January, up an enormous 59pc on the year.

And first-time buyers were a big part of it. Almost half of those getting approval from a bank to borrow were first-time buyers.

For a while now there have been rises in the numbers getting the nod to take out a mortgage, but the added incentives of the Government’s help-to-buy scheme, and the change in lending limits, have put extra pep to the mortgage market. No wonder many economists reckon help-to-buy will be counter-productive and just overheat the market.

Combine all of this with a chronic shortage of places to buy, as builders struggle to meet demand, and you get a surge in the volume and the value of lending.

The average first-time buyer is now getting approval to take on a mortgage of close to €200,000. This is almost €25,000 more than was being borrowed a year ago.

So builders have gone into overdrive. This journalist was told by a builder this week that he is so busy he is turning jobs down. He was offered six construction projects in one day.

Even so, it will be two years before overall building output matches supply.

In the meantime, prices will continue to rise. And overall mortgage lending will likely hit €7bn this year, as new buyers are incentivised by the State rebate to pay more. Economists reckon a normal mortgage market here should be lending around €10bn a year.

That we are getting close to a return to a more normal mortgage market will please the banks. For buyers, finding something suitable to purchase and coping with demands of ever-rising property prices will be the big challenges for a while yet.