Mortgage rates in Ireland are the highest in Europe

Irish mortgagors generally pay 2,500 euros more per year than their European counterparts because of premium rates charged by Irish banks, a situation described as "totally unjustifiable" by Fianna Fáil

. In Ireland, the average rate applied to new mortgages in the last 12 months was 3.21 per cent, compared to an average of 1.8 per cent in the euro area.

The differential stands at about 2,557 euros a year on a standard basis of 300,000 euros. Mortgage, or € 63,918 over 25 years

While the so-called "wedge" between rates here and elsewhere has been declining due to increased competition in the market, the latest figures show that the # The gap is still significant Not only did Ireland have the highest average rate of all euro area states, but it was the only one to have an average rate above 3%

Michael McGrath, door Fianna Fáil's Finance Committee, said: Interest rates in Ireland are totally unjustifiable and banks can not continue to harbad Irish consumers in this way.

"This huge difference is affecting the quality of life of hundreds of thousands of people and families around the world.

NPLs

Brian Hayes, MEP for Fine Gael, said the high level of NPLs on banks' balance sheets was also a factor in the gap. He said the best prices could be facilitated by a euro-wide resolution to allow cross-border financial services,

Central Bank figures indicate a 33 percent increase in new financial services Mortgage agreements within 12 months until May. The volume of new mortgages amounted to 681 million euros in May, bringing these loans to 7.22 billion euros in the last 12 months.

Figures show that fixed rate mortgages accounted for 54% of new home loans. May

vs. 80% of new agreements at the same time in the euro area

The number of buyers opting for fixed rates has risen sharply in recent years. In 2014, fixed-rate products accounted for only 10 per cent of Irish home loans

Improvement

Although fixed-rate setting conditions were improved, Rachel McGovern of Brokers Ireland, "Mortgages Across Europe can be guaranteed for periods of 20 years and in some cases for the duration of the mortgage, and there is no reason for such mortgages to be unavailable in Ireland. "

The recent decision of Ulster Bank to introduce a fixed rate of 2.3% is expected to upset the market

"Lenders can finance these conditions so that there is no reason not to offer these better quality products to Irish consumers."

Since the crash at the end of 2008, Irish banks have largely failed at

Banks have long argued that higher rates reflect high lending risk in the Irish market, but in reality the premium was there to compensate loss-making portfolios.

The introduction by the Ulster Bank of a fixed rate of 2.3% should move the market here.

However, the trend towards European standards could be overtaken by a general rate hike as the European Central Bank prepares to end its quantitative easing program, and prepares to tighten monetary policy across the bloc. .