Mortgage interest rates in the Republic remain below that of the euro area average, according to new figures from the Central Bank.
Traditionally, mortgage interest rates here closely tracked movements in the ECB’s main refinancing rate (MRO) more than comparable euro area rates.
This reflected the higher proportion of tracker and variable rate mortgage products in the Irish market which are linked to the ECB’s rate.
However, since the crash the average Irish interest rate on outstanding mortgages has “diverged” from the ECB’s main rate.
Today’s figures show the interest rate on mortgages, with either a floating rate or initial rate fixation of up to one year, was 3.01 per cent at the end of January, down 24 basis points on the previous month.
The corresponding end-of-January-rate for the euro area was, however, 21 basis points lower at 2.8 per cent.
The figures also showed variable rate loans accounted for 84 per cent of all new mortgage business in the domestic Irish market over the past year.
In contrast, variable rate loans in the euro area - which is traditionally dominated by fixed-rate loans - accounted for just 27 per cent of new mortgage business over the past year.
