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Irish mortgage customers pay an extra €188 a month

Written by Robert McHugh, on 10th Aug 2018. Posted in Ireland

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Irish mortgage customers continue to pay way higher interest rates than customers in any other country in the Eurozone, according to the latest figures from the Central Bank. 
 
The average interest rate issued on a new mortgage in June was 3.23% (a rise from 3.21% in May). Although low for Ireland by historical standards, this compares to an average rate of just 1.78% across Europe (a drop from 1.8% in May). This means a typical first-time buyer who’s borrowing €250,000 over 30 years will pay an extra €188 a month.  
 
The figures also show that the popularity of fixed rates continues to rise and these accounted for 59% of new mortgage lending in the three months to June (up from 54% in May). However, this is still low by European standards where 80% of mortgages are fixed.   
 
A first-time buyer who takes out a mortgage of €250,000 in Ireland over 30 years would pay around €1,085 a month based on average rates. In Europe they would pay on average €897. So in Ireland, first time buyers are paying an extra €188 a month to the banks (or almost €68,000 extra over the lifetime of the mortgage). 
 
Commenting on these findings, Head of Communications at bonkers.ie, Daragh Cassidy said, "Over four years after the recession came to an end, the Irish mortgage rate ripoff continues. Despite the recent rate reductions from some of the main banks, Irish mortgage holders continue to pay more for their mortgage than any other country in the Eurozone. And the gap seems to be getting bigger."

He added, "If you’re a first-time buyer who’s at the start of the mortgage journey, make sure you do your research and shop around. There’s now a huge variation in interest rates and cashback incentives across all the different lenders so find out who’s offering the best deal for you."

Source: www.businessworld.ie

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