Mortgage rates at their lowest level in year and a half

Mortgage rates in this country continue to move lower while deposit rates remain broadly steady, according to the latest data from the Central Bank. The average mortgage rate in Ireland is now at its lowest level in almost a year and a half. It was 4.

03pc in October. Average home-loan rates in the Eurozone are about half a percentage point lower. Ireland currently has the sixth highest rates in the Eurozone, the same as the previous month.



However, the gap between Irish rates and the average Eurozone rate continues to increase and is now at its widest level in over two years, the Central Bank figures show. Rates vary from as low as 1.77pc in Malta to as high as 4.

89pc in Latvia. For savers, the average fixed deposit rate remained largely unchanged at 2.64pc.

This is slightly below the Eurozone average of 2.73pc. The new figures come ahead of an expected cut of 0.

25 percentage points in European Central Bank rates tomorrow. Some analysts think the ECB may even opt for a 0.5 points cut in rates.

Any cut will directly benefit almost 130,000 people on tracker mortgages, and may see new fixed rates come down again. It will be the fourth ECB rate cut in the last while, with a string of reductions expected next year. Head of communications at mortgage broker Bonkers.

ie Daragh Cassidy said “Although Irish mortgage rates continue to inch lower, they’re falling more slowly in Ireland compared to the rest of the Eurozone. “There is now a half a percentage point gap between the average rate here in Ireland and the average rate in the Eurozone, which you’d hope isn’t going to get any bigger.” Mr Cassidy said attention now turns to what the ECB will do at its final monetary policy meeting of the year tomorrow.

“A quarter point cut is almost a given with a small chance of a bigger half-point cut. “Either way the ECB is likely to continue to cut rates into next year as long as inflation remains under control,” he said. The Bonkers.

ie executive said this will feed through into even lower mortgage rates in Ireland over the coming months. Tracker customers will benefit the most. “But so too will the so-called mortgage prisoners whose loans were sold to vulture funds and some of whom are still paying extortionate rates as high as 7pc or more right now,” Mr Cassidy said.

But he warned that savers will be the losers in a situation where rates are falling. Online banks Revolut and N26 have both recently cut their rates, the latter for the second time. Though there has been little movement from the main banks so far, Mr Cassidy said.

Irish households currently have over €160bnn resting on deposit. But the majority of the money is still in accounts that pay little to no interest. Mr Cassidy encouraged savers to lock into the higher rates while they are still available.

Both AIB and Bank of Ireland are still offering up to 3pc interest, while rates over 3pc are still on offer through the online savings platform Raisin as well as with Dutch bank Bunq..