Irish mortgage customers pay extra €188 a month compared to other Eurozone countries

Irish mortgage customers pay extra €188 a month compared to other Eurozone countries

Figures released by the Central Bank today revealed that Irish mortgage customers continue to pay higher interest rates than customers in any other country in the Eurozone.

According to the Central Bank, the average interest rate issued on a new mortgage in June was 3.23% which marks a rise from 3.21% in May.

This compares to an average rate of 1.78% across Europe.

This means a typical first-time buyer in Ireland who is borrowing €250,000 over 30 years will pay an extra €188 a month compared to their Eurozone counterparts.

The latest figures also show that the popularity of fixed rates continues to rise among Irish customers, accounting for 59% of new mortgage lending in the three months to June.

Despite this rise, this is still low by European standards where 80% of mortgages are fixed.

"Over four years after the recession came to an end, the Irish mortgage rate ripoff continues," said Daragh Cassidy, Head of Communications at price comparison and switching website bonkers.ie.

"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."

Joey Sheahan, Head of Credit at mymortgages.ie, believes that the rise in fixed mortgages is a good indication of the way the Irish market it moving.

"It perhaps signals an impending explosion in the fixed rate mortgage market in Ireland," said Mr Sheahan.

"The banks know that the popularity of fixed rates is soaring - KBC is the latest to slash its rates to 5-year fixed rate to 2.8%. Ulster Bank are now offering a 2.3% 2-year fixed rate and a 3.25% fixed rate for 7 years.

"PTSB have also recently dropped its fixed rates to 3.7% for existing customers. These cuts signal real savings for mortgage holders."

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