New figures from the Central Bank reveal that mortgage interest rates in Ireland edged down slightly, offering some relief to borrowers. The average interest rate on new mortgages stood at 3.6%.
For those weighing their options, fixed-rate mortgages averaged 3.52%, while variable-rate products remained considerably higher at 4.08%. This continues the trend of fixed rates being the more affordable choice for most buyers.
👉 Tip for borrowers: Choosing between fixed and variable rates can have a big impact on your long-term repayments. Irish Mortgage Corporation can compare all products available and help you decide which suits your circumstances best.
How Ireland Compares to the Euro Zone
Despite this modest decline, Ireland remains one of the more expensive countries in the euro zone for mortgages. Across the euro area, the average mortgage interest rate was 3.29% in June, noticeably lower than Ireland’s 3.6%.
Ireland ranked seventh-highest among euro zone countries, up from eighth the month before. At the top end of the scale, Latvia had the highest average rate at 4.15%, while Malta recorded the lowest at just 1.72%.
For Irish borrowers, this highlights a frustrating reality: even when rates fall slightly, home loans here remain pricier than in many neighbouring countries.
👉 Want to avoid overpaying? By working with Irish Mortgage Corporation, you gain access to products across multiple lenders – not just what your bank offers. This ensures you don’t miss out on lower-rate options that could save you thousands over the lifetime of your loan.
Why Are Irish Mortgage Rates Higher?
Industry experts point to several factors that explain why Ireland consistently ranks near the top of the euro zone for borrowing costs. Trevor Grant,chairperson of Irish Mortgage Advisors, said there are many reasons for Ireland being one of the more expensive euro zone countries for mortgages.
He said, “For example, Irish lenders are required to hold more capital than many of their European peers,” he explained. “Also, when a borrower defaults on a mortgage, Irish lenders have stated that they often find it more difficult than other European lenders to take control of and sell off the assets that were pledged as collateral to secure the mortgage. Notwithstanding all this, there is still room for improvement and slowly competition is bringing rates down,” he added. (link to interview article)
So, Irish lenders are required to hold more capital than their European peers, which raises operating costs. In addition, when borrowers default, lenders here often face longer and more complex processes to repossess and sell collateral.
This combination of higher risk and tighter regulation means Irish mortgage rates remain stubbornly above the euro zone average, even when competition begins to push prices down.
Good News: Competition Is Growing
Despite these challenges, there are encouraging signs for Irish borrowers. Trevor Grant said there is still plenty of competition amongst lenders.
“Some lenders started offering sub-3% mortgage rates this summer, which represented a significant milestone for Irish borrowers and should lead to substantial savings for homeowners and house buyers,” he said. (link to interview article)
These competitive offers aren’t always easy to find, and eligibility can vary depending on income, loan-to-value ratio, and lender criteria. That’s where professional guidance becomes essential.
👉 Don’t miss out on better rates. At Irish Mortgage Corporation, we know which banks and lenders are currently offering these sub-3% deals. We’ll assess your situation and match you with the best mortgage available — saving you both time and money. Check if you qualify today.
The Bottom Line
While Irish mortgage rates slipped slightly in June, they remain higher than much of Europe. The small decline is good news, but borrowers shouldn’t expect dramatic drops ahead — especially given uncertainty around ECB policy.
Furthermore, Trevor said, “This significant shift in ECB policy could not only mark the end of its rate cutting cycle, it could also herald that ECB rate hikes might be on the cards in late 2026, particularly if inflation starts to edge upwards in the EU again. So mortgage borrowers and would-be house buyers should be mindful that the pace of further mortgage rate cuts is likely to slow or even come to an end.” Borrowers should therefore avoid making large financial decisions based on the hope that ECB rates will drop further or indefinitely,” he added. (link to interview article)
The real opportunity lies in shopping the market, comparing lenders, and moving quickly when competitive products appear. Working with an experienced mortgage broker like Irish Mortgage Corporation ensures you’re not leaving money on the table.
👉 Take the next step: Whether you’re a first-time buyer, switching mortgages, or reviewing your current mortgage, Irish Mortgage Corporation can help you secure the best mortgage rates in Ireland. Get expert advice today.
