Micheál Martin has promised relief for cash-strapped mortgage holders in the Budget.
The Tanaiste was speaking after homeowners were hit with another hammer blow from the ECB after the bank’s President, Christine LaGarde, announced an eighth interest rate hike in just over a year.
The base rate was notched up another 0.25%, bringing it up to 4% which adds hundreds more euros to typical mortgage bills every year.
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There have been eight hikes since last summer, bringing the base rate from 0% to 4% and adding around €5,000 a year to the cost of an average €250,000 mortgage.
The latest quarter per cent rise in rates will see borrowers have to pay an average of €13 more per month for every €100,000 they have borrowed. There are around 250,000 tracker mortgage customers in the country who will see the rate increases applied automatically.
Fixed rate customers and those with variable rate mortgages are likely to see the rate hikes coming down the tracks from the main lenders at a later date.
Sinn Féin finance spokesman, Pearse Doherty, called for the reintroduction or mortgage interest relief in the wake of the latest hike, which the ECB indicated would not be the last. Mr Martin said that there would be help coming in the Budget.
He said: “I want to acknowledge that those interest rate hikes do put pressure on people, particularly mortgage holders. We will examine that, it will be in the context of the Budget and the broader cost of living issues.
“We do accept that there has been significant pressure over the last year and a half since the war in Ukraine began, the spiralling inflation arising out of Covid.
“Inflation has to be brought under control, it’s coming under control. Monetary policy is an instrument to do that, but it has then put pressures on people. We’ve got to work out how we can help people who are under those pressures.”
Mr Martin was asked specifically if the reintroduction of mortgage interest relief for hard-pressed mortgage holders would be part of the upcoming Budget.
He replied: “We’ll be looking at the broader context of cost of living in the Budget and how do we alleviate pressures on people that are undoubtedly there.
“We did a lot over the past year, €12billion in 12 months allocated in measures to alleviate pressures, reducing the costs of public services, reducing taxation which we did last year.
“There are a variety of ways we can do this.”
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