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Ireland has the 3rd lowest mortgage rate in the Eurozone - Kerry Today

Thu 13th Apr 2023

Although mortgage holders have come under strain recently due to the European Central Bank (ECB) rising its interest rates, it's been discovered that mortgage rates in Ireland have fallen. This drop has resulted in Ireland having some of the lowest mortgage rates in the Eurozone at the moment.

Daragh Cassidy, head of Communications at bonkers.ie, appeared on Radio Kerry to discuss this unexpected news and what it means for mortgage holders and applicants.

Listen back to the interview above or check out the main points discussed below.

Key points from the interview

Mortgage rates in Ireland

The ECB has raised interest rates from 0% - 3.5% since July 2022 in order to combat inflation. These rates are rumoured to rise again to 4%.
However, banks in Ireland have been slow to pass on these rate increases to mortgage holders, meaning Ireland has some of the lowest mortgage rates in the Eurozone.
This is quite a turnaround as it wasn’t long ago that we had the most expensive mortgage rates in the Eurozone, however, these low rates are not expected to last a whole lot longer.
Many people on tracker mortgages are wondering if they should move off their tracker mortgage, as they have faced six rate increases since July as their rates increase in line with ECB rises.
If the ECB raises its rates to 4%, then tracker mortgage holders will be paying up to 5.25% on their mortgage.
However, if you are considering moving off your tracker mortgage you need to get financial advice from a mortgage broker, as your bank will not let you return to a tracker mortgage.
If you lock into a fixed mortgage rate, you will be able to remain on the same mortgage rate for five years for example. There are fixed rates out there that are around 3.5% - 4%.
The reason we have such low mortgage rates in Ireland is that we have really low savings rates. Savers are receiving little to no return on their savings, which means savers are essentially part-funding cheap mortgage rates here.

Mortgage rates available for first-time buyers

If you are a first-time buyer and looking to borrow €270,000 with a 10% deposit, the cheapest variable-rate available is 3.15%, while the cheapest fixed rate is 3.4%. However, some rates are as high as 6%.
This is why it's important to shop around on mortgage comparison sites like bonkers.ie to find the best value rate for you.
You also don’t need to take out your mortgage with the bank that you have your current account with, which is something a lot of mortgage applicants do not realise.
Find out which bank has the best mortgage rates for first-time buyers here.

Savings rates in Ireland

The rate for savers at the moment is with Permanent TSB, however, it is still not great at 1.5%, especially as you still need 33% DIRT on top of that.
Raisin Bank is also another option for people, this is an online platform which gives you access to saving products across Europe. If you are open to moving your money outside of Ireland, you could secure a savings rate as high as 3.5% over five years.
The savings are guaranteed up to €100,000 under Raisin’s deposit scheme.

Revolut brings competition to the Irish banking market

Revolut has launched a new version of its app which includes joint accounts rates.
Revolut has transformed itself into a competitive bank in Ireland. It now provides customers with Irish IBANs and also offers joint accounts, personal loans and credit cards.

Get your mortgage with bonkers.ie

Whether you’re a first-time buyer or looking to switch to a fixed rate, with our free mortgage broker service, you can lock in the best-value mortgage for you. Once you submit your online mortgage enquiry, you’ll receive a call from one of our experienced financial advisors who will help you get your application started and ensure you’re mortgage ready.

Our mortgage advisors will help you find the best rate and guide you through your application.Don’t forget you can also get the best deals for energy, broadband, and insurance and compare banking products on bonkers.ie.

Get in touch

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