Irish homeowners and families are facing further mortgage pressure amid fears three more interest rate rises will be announced by the European Central Bank (ECB) later this year.
Next week, the ECB is expected to reveal a further mortgage interest rate hike, the Irish Independent reports.
The rise, which is anticipated to be between 0.25 to a possible 0.5 percentage-points, will make it much harder for first-time buyers to purchase a home as well as increase pressure on the hundreds of thousands on tracker mortgages.
Pierre Wunsch, a member of the European Central Bank’s rate-setting governing council told the Financial Times that they are "waiting for wage growth and core inflation to go down" as well as headline inflation, before a pause on interest rates can begin.
Mr Wunsch said he would "not be surprised" if the eurozone key rate increased to 4 per cent. The ECB council is expected to make the next rate rise at its next meeting on May 4.
Markets are currently predicting three consecutive 0.25 to 0.5 percentage-point interest rate hikes over the next three meetings of the council, meaning the ECB main refinancing rate could be 4.25 per cent by the end of July.
This will affect tracker mortgage holders in Ireland, as it will mean homeowners or families will have to pay an average increase of up to €2,576 per year.
The Independent also reports that some 50,000 mortgage holders are due to come out of their fixed rates over the next 36 months, with top analysts advising them to re-fix before even further hikes.
Mr Wunsch added that the ECB will continue to raise mortgage interest rates until wage growth slows across Europe.
READ NEXT:
- Ex-Fianna Fáil councillor John Hussey jailed for sexually assaulting girl, 8, at sleepover in his home
- Ireland weather set for remarkable U-turn as Met Eireann give bank holiday weekend verdict
- Pilot sucked out of plane window on flight to Spain as cabin crew held onto his ankles
- Conor McGregor documentary trailer drops as release date announced
- Angela Scanlon chat show loses over 60,000 viewers in a week as RTE's weekend shows take major ratings hit
Get news updates direct to your inbox by signing up to our daily newsletter here
