Mortgage rates hold steady but are expected to fall in the next few months

The average rate is now 3.59pc, roughly in line with the previous month, according to new data from the Central Bank of Ireland.

But recent cuts in borrowing rates from AIB and PTSB will mean that the next set of figures from the Central Bank is likely to lead to a lower average mortgage rate.

The average mortgage rate was 3.59pc in September compared with 3.58pc in August, the lowest they have been in a year and a half.

The average rate across the Eurozone was 3.34pc, the Central Bank said.

Mortgage rates at their lowest level since March 2023, but are the seventh highest in the Eurozone.

Rates vary hugely across the currency bloc, from as low as 1.85pc in Malta to as high as 4.03pc in Latvia.

First-time buyers and switchers were warned that there are wide variations in rates in this market from the 10 different lenders.

An analysis by mortgage brokerage and price comparison site Bonkers.ie shows that for a first-time buyer couple borrowing €300,000, with a 10pc deposit, variable rates range from 3.29pc to 4.70pc.

Rates for a three-year fixed mortgage range from 3.20pc to 4.85pc.

Daragh Cassidy at Bonkers.ie reminded borrowers of the importance of shopping around when applying for a mortgage.

“Mortgage rates remain at their lowest level since March 2023, which is obviously good news for prospective first-time buyers and those looking to switch their mortgage over the coming months.”

He said that in recent weeks we have seen further rate cuts from AIB and PTSB which should feed through into the data over the coming months.

“So the average rate should creep a little bit lower before the end of the year.

“But the 3.59pc average rate really is just that — an average,” Mr Cassidy.

He said there are 10 lenders in the Irish mortgage market at present and there is a wide variation in rates across them all.

And different lenders offer different cashback deals and incentives, which also need to be taken into account.

“For example, a variable rate as low as 3.29pc is available right now for a standard first-time buyer with Avant Money’s new tracker-like mortgage product.

“But it’s 4.15pc with AIB and 4.70pc with PTSB – it’s a big difference.

He said it was the same situation for fixed rates.

“So I’d really encourage consumers to compare the market and shop around when applying for a mortgage, either as a first-time buyer or switcher.”

Interest rates on mortgages offered by AIB, EBS and Haven were reduced last month

The move will see non-green rates cut by up to 0.65 percentage points.

And a number of credit unions have come together to offer a standard mortgage product that will give new buyers and switchers an alternative to the banks.

The new product, Credit Union Mortgage, will mean there will be a standardised national mortgage, with a set interest rate.

The new single mortgage product is launching with a variable interest rate of a competitive 3.85pc.

The rate will be capped at 4.4pc for the first three years.

Permanent TSB dropped both its mortgage and deposit interest rates, following the recent series of reductions by the European Central Bank.