Responding to the recent Central Bank Retail Interest Rates publication for August showing Ireland with a weighted average interest rate on new mortgages of 4.10%, up 146 basis points in a year, and close to the euro area average which is 0.15% lower, Brokers Ireland said those taking out mortgages need to consider their options very carefully.
Rachel McGovern, Director of Financial Services at Brokers Ireland said while most people taking out mortgages, 86%, opt for fixed rates, “we don’t know the periods they are fixing for.”
“Regardless of the fact that before July 2022 we’ve had the best long-term fixed interest rates we’ve ever seen in Ireland, the most attractive of which have since been withdrawn from the market, Irish people still opted for fixing for short periods of just three to five years.
“These people are now coming off those rates and facing much higher rates than they would have anticipated, because we had gotten used to low rates for an extended period,” Ms McGovern stated.
She said no one can predict with any degree of certainty what the future is going to be.
“Therefore, people need to consider the issue very carefully, and ideally take impartial advice from a professional who will tailor it specifically to your particular needs, given your plans for the future,” she added.
She said a mortgage is generally the biggest outlay most people have and this is so for a considerable period of their lives, noting it to be unfortunate that the Irish market currently lacks sufficient competition.
