The era of cheaper home loans is beginning to unwind for Irish borrowers. After months in which lenders soaked up the European Central Bank’s rate rises, mortgage providers have started passing on higher costs, with PTSB becoming the first of the main high-street banks to raise its fixed rates and smaller lender MoCo following with an increase across its range.
Brokers have warned of a “tough winter” for borrowers, and while the ECB opted to pause its run of increases at its October meeting, the pressure on rates has not gone away.
Who has raised rates
PTSB moved first among the pillar banks. RTÉ reported on 22 October that it was increasing its fixed mortgage rates by a weighted average of 0.3 percentage points, with rises of between 0.2 and 0.35 points depending on the length of the fix, the loan size and the loan-to-value ratio. Existing fixed-rate customers and variable-rate customers were not affected. Borrowers who already have a mortgage offer can still draw down at the old rate until 19 January 2027 or until their offer expires, whichever is sooner.
Price comparison site Bonkers.ie lists MoCo as raising interest rates on all its fixed and variable mortgages by 0.40% from 28 October. MoCo’s own rates page now shows three- and five-year fixed rates starting at 4.10% for borrowers with lower loan-to-value ratios, rising to 4.45% at up to 90% loan-to-value. PTSB’s increases also applied to three-, four-, five- and seven-year fixes, according to Bonkers.ie.
They are not alone. Non-bank lenders ICS Mortgages, Núa Money and Pepper Advantage have all raised rates in recent months, RTÉ reported, and Avant Money increased rates on its Flex mortgage products in September, according to Bonkers.ie. AIB went the other way in mid-October, cutting its four-year fixed rate for loans over €250,000, but RTÉ said that was widely seen as a move to win new business rather than a sign that rates were heading down.
Why it is happening now
The ECB raised its rates twice between June and September, by half a percentage point in total, as it tried to stop an energy price surge linked to the conflict in the Middle East from feeding into wider inflation. Irish banks initially absorbed those increases, but RTÉ’s analysis said they were always likely to follow once one lender moved. Tracker mortgage holders, whose rates move directly with the ECB, saw the increases passed on straight away, NFP Ireland’s Sorcha Timoney told the Irish Examiner.
The latest Central Bank figures, for August, show the average rate on new Irish mortgages was 3.53%, below the euro area average of 3.62%, but the average new variable rate had risen to 4.16%, according to both the Irish Times and the Irish Examiner. Those figures predate the ECB’s September increase. Brokers Ireland’s Rachel McGovern told the Irish Times that the outlook for rates was “looking less optimistic”.
What it could cost you
For people coming off a fixed rate or buying a home, small moves add up. As an illustration, on a €300,000 mortgage over 30 years, a rise from 3.5% to 3.8% would push the monthly repayment from about €1,347 to about €1,398, or roughly €600 more a year. This is our own calculation and actual costs depend on the lender, the term and the loan-to-value.
The Association of Irish Mortgage Advisors’ Trevor Grant told the Irish Examiner that competition between lenders, rather than the ECB alone, remains the main driver of Irish mortgage pricing. That means borrowers who shop around, consider switching or lock in an offer before further rises could still protect themselves. Anyone with an approval in principle or a loan offer should check its expiry date and the rate it guarantees.
What happens next
The ECB paused at its 29 October meeting, but policymakers have not ruled out further rises if energy prices stay high. The key question now is whether AIB and Bank of Ireland follow PTSB. Bank of Ireland has already raised rates on some of its fixed-term savings products, according to RTÉ, but had not announced mortgage changes at the time of writing. The ECB’s next policy meeting is in December.
Sources
- RTÉ News: Are more mortgage rate increases likely after PTSB hike? (22 October 2026)
- Bonkers.ie: Price change calendar (accessed 1 November 2026)
- Bonkers.ie: Mortgage rate changes in Ireland (accessed 1 November 2026)
- MoCo: Our mortgage loan interest rates (accessed 1 November 2026)
- Irish Examiner: Mortgage rates edge up as ECB hikes yet to feed through (14 October 2026)
- The Irish Times: Irish borrowers ‘facing tough winter’ with mortgage costs on rise (14 October 2026)
Featured image: photo by Tierra Mallorca on Unsplash.
Leave a Reply