Ireland continues to have the highest mortgage interest rates across the euro area in January, new figures from the Central Bank show.
The Central Bank said the average interest rate on new mortgages in Ireland stood at 2.79% in January, down 13 basis points on the same time last year.
This compares to the euro area average rate of 1.29%, although the rate varied considerably across countries.
Today’s Central Bank figures show that the average interest rate on new fixed rate mortgage agreements dropped by two basis points to 2.65% in January. Fixed rate mortgages accounted for 80% of new motgages during the month.
For new variable rate mortgage deals, the bank said the average interest rate stood at 3.35% in January.
It said this marked an increase of 14 basis points from the previous month, although volumes agreed remain volatile.
Meanwhile, the volume of new mortgage agreements amounted to €500m in January, down 7% on the same time last year and a 48% reduction compared with December 2020.
Today’s Central Bank figures also show that interest rates on new household term deposits remained at 0.02% in January. The equivalent euro area rate was 0.26%, the bank added.
Commenting on the report published today, Trevor Grant, Chairperson of the Association of Expert Mortgage Advisors said it is important that mortgage holders and potential switchers aren’t disheartened or dissuaded by the data.
“The fact is that, yes, our rates are higher, for a variety of reasons – some of which can and should be addressed, but there is still a lot of competition in the market and the cost savings that many homeowners can make by switching their mortgage are better than they have been in many years.
“Average mortgage holders still stand to be able to save €200 or more per month on their mortgage.
Mr Grant said there are “significantly better” terms and savings available to thousands of mortgage holders.
He said it is just a matter of these borrowers seeking market-based advice to point them in the right direction.
“Some homeowners are paying mortgage rates of 3.5% or more and could easily switch to rate closer to 2%, saving hundreds in monthly repayments, and thousands in interest payments over the remaining term of their mortgage,” he added.