Good news for buyers as mortgage rates continue to fall
According to figures released on Tuesday by the Central Bank, the average Irish mortgage rate is now 3.66%. This marks a decrease from 4.17% in May of last year and brings the Irish average closer to the eurozone's 3.32%.
Irish mortgage rates are said to have benefited from falling European Central Bank (ECB) rates. Mortgage interest rates have continued to drop. Pic: Shutterstock
These figures come as the number of mortgage approvals has also risen.
It is expected the lower rates will make it even easier for first-time buyers to enter the market. The average Irish mortgage rate is now 3.66%. Pic: Getty Images
The ECB is expected to maintain the current rates at its next monetary policy meeting on July 24.
While the average Irish rate has fallen to 3.66%, it stands at 1.80% in Malta and as high as 4.29% in Latvia.
Despite the fall in rates, affordability in the housing market remains a concern. Trevor Grant, chair of the Association of Irish Mortgage Advisors, pointed out that while falling rates are a positive sign, 'borrowers here are still paying more than some of their European counterparts'. Irish mortgage rates are said to have benefited from falling European Central Bank (ECB) rates. Pic: Shutterstock
He said: 'One in three first-time buyer homes were valued over €400,000 in 2024, three times the 2019 share… And it has recently been reported that average household incomes for new buyers sits at €85,000, so it's clear that affordability continues to be stretched.'
Experts have also raised concerns that, without an adequate increase in housing supply, lowering mortgage rates may mean very little.
Fiona McMahon, a senior mortgage adviser from NFP Ireland, warned that 'rate cuts can help with affordability but only to a point. Without significant improvements in housing availability, we risk fuelling more competition for fewer homes which drives up prices and ultimately cancels out the benefit of lower interest rates'.
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