Thursday 21 November 2019

Buyers paying extra €85,000 on their mortgage here


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Charlie Weston

Charlie Weston

Mortgage interest rates in this country are twice the average level for the eurozone.

Rates here fell below 3pc in September - but the fall was sharper in most other countries, a move that widened the gap between Irish mortgage rates and the average across the eurozone.

This means typical new buyers here with a €300,000 mortgage over 30 years are paying €235 more a month than the average for the currency bloc.

This works out at €85,000 over the lifetime of the mortgage, according to Brokers Ireland.

The brokers were reacting to new Central Bank figures showing the average interest rate on all new mortgages was 2.96pc in September. This was down from 3.07pc the previous month.

In contrast, the average for the eurozone is just 1.41pc.

Director of financial services at Brokers Ireland Rachel McGovern said new borrowers here were paying €2,820 more a year than the average paid by borrowers in the euro area.

"Small percentages amount to a massive sum over the lifetime of a mortgage," she said.

"And this is money foregone that could otherwise be put towards children's education into the future or pension planning."

Ms McGovern said the fact more than seven in every 10 mortgage holders were now opting for a fixed rate showed consumers were seeking greater security.

Daragh Cassidy of price comparison site said rates had fallen slightly over the past year, but they remained way too high.

"Worryingly, the gap between the average rate charged in Ireland and in the eurozone only appears to be getting bigger," he said.

Irish Independent

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