Irish Mortgage Costs Decline to 3.5% in April, Nearing Euro Area Average

The average cost of Irish mortgages decreased marginally in April to 3.5 per cent, down two basis points from March, according to new Central Bank data. This rate is now just above the euro area average of 3.45 per cent. The annual decrease was 22 basis points, the third largest in the euro area, moving Ireland's rate to the 10th highest, down five places from last year.

Fixed-rate mortgages constituted 92 per cent of new agreements, with an average rate of 3.45 per cent, down one basis point monthly and 10 annually. This share is the highest since February 2023. Variable mortgages averaged 4.13 per cent in April, up eight basis points from March but down 32 annually.

The total volume of new mortgage agreements fell by €20 million (2%) to €884 million. Renegotiated mortgages totaled €461 million, down €47 million monthly but up €225 million annually, with 93 per cent being fixed-rate at an average of 3.28 per cent.

Trevor Grant, Irish Mortgage Advisors chairman, cautioned that future rate drops might be limited. He suggested borrowers consider fixing their mortgages quickly, especially if the ECB raises rates as expected. Meanwhile, new consumer loan rates rose 10 basis points to 7.08 per cent, with a total volume of €284 million. Savings rates on household overnight deposits remained at 0.14 per cent, while new household deposits with agreed maturity were 1.85 per cent, down 10 basis points annually. Rachel McGovern of Brokers Ireland criticized these low savings rates, noting that over €149 billion is held in overnight deposits, losing value as inflation reached 3.7 per cent in April.