A new interest rate hike expected to be announced by the European Central Bank (ECB) later this week could significantly add to Irish homeowner's mortgage repayments.
The 0.75 per cent increase is predicted to be put in place on Thursday following an ECB meeting on its key lending rate.
It will mark the third rise in rates since the summer, which could add a total of €1,620 a year to the cost of a tracker mortgage taken out during the boom.
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This week's increase, should it go ahead, could add €600 to the annual cost of a mortgage and a fourth hike before the year ends has also not been ruled out.
The increase will affect around 500,000 tracker and variable rate mortgage holders.
Increase in inflation, soaring energy prices, and the healing of supply chains off the back of the Covid-19 pandemic has been further compounded by Russia’s invasion of Ukraine, with the ECB saying it feels it has no choice but to introduce another rise to contain inflation running five times higher than its target, according to a Reuters poll.
The two recent rate rises have seen a family with 15 years left and €150,000 to pay on a tracker facing an extra €84 in monthly payments or an additional cost of €1,000 annually.
This is for a tracker with a 1pc margin over the ECB refinancing rate.
If the 0.75 per cent increase is introduced, it will add another €50 to the monthly costs of the mortgage.
This will mean monthly tracker mortgage costs will have increased by €135 since the summer or €1,620 annually.
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