A North Kildare TD has called for increased action to open up the Irish mortgage market to ensure that Ireland enjoys the same mortgage rates as other EU countries.
“Ireland mortgage rates are entirely unjustifiable and the banks must be tackled to ensure that fairer mortgage rates are available to Irish home owners. Irish mortgages are double that of the average in the EU, 3.3% as opposed to EU average of about 1.7%," said Dep Frank O'Rourke.
“An Irish mortgage holder, with a 30 year term of €250,000, is paying €1,085 per month. This is around €188 per month, equivalent to €2,200 per year or €68,000 over the lifetime of the mortgage, more than they would be paying in the average Euro area country.
“This massive differential is impacting negatively on the quality of life of hundreds of thousands of individuals and families around our country and depriving local economy of much needed stimulus.”
He said according to the Head of the European Central Bank (ECB), Mario Dragi, the Irish mortgage market is an effective monopoly and this is contributing to the high mortgage rates in Ireland.
"AIB and Bank of Ireland have 60pc of new mortgage lending. More competition is required," he added.
“Over the last 10 years, people’s wages have increased very little and we need to focus on reducing the cost of living to ease the pressure on wage inflation. Reducing people’s mortgage repayments is one mechanism to reduce the cost of living. We can do this by opening up the market to other EU Banks. I have called for this approach as well in relation to motor insurance.”
He said all of the instruments available to the Government and the Central Bank must be used to ensure that Irish mortgage holders receive fair treatment when compared to other EU countries.