The European Central Bank was the last of the big central banks to start raising interest rates and it is on track to be the first to start cutting rates.
Policymakers kept rates unchanged yesterday, but their official policy announcement explicitly mentioned the possibility of cutting rates for the first time in the current cycle, which is considered as the ECB almost locking in a rate cut at its next meeting in June.
So while there was no reprieve for tracker mortgage holders yesterday, there is good news on the horizon.
Joey Sheahan, Head of Credit, online brokers MyMortgages.ie, said the expected 0.25% cut in June and all subsequent cuts will put money back into the pockets of tracker mortgage holders and the wider economy.
The average mortgage holder on a tracker owes about €215,000 and has around 14 years remaining on the mortgage. With an average margin of 1% over the ECB which was 0% and is now 4.5%, it means the average tracker holder is currently paying about 5.5% interest.
"These borrowers have seen their payments increase by about €5,000 annually over the past couple of years, so every time we see a drop, it's anticipated June will be the first one, you'll see around €28 a month or €336 a year €1,344 over the life of the mortgage," Mr Sheahan said.
"And when you consider that there is hundreds of thousands of tracker mortgages out there, every quarter of a percentage point cut is injecting tens of millions back into the economy, and back into people's pockets, which is obviously great news."
There is also growing competition in the mortgage market that fixed rate customers can avail of.
In the last couple of weeks, PTSB, AIB, Bank of Ireland, EBS and Haven all dropped their fixed rates.
"There are rates as low as 3.4/3.5% out there today, so borrowers need to take action. Contact your bank, ask them what rate are you on and what breakage fee applies if any," Mr Sheahan said. "We're seeing a flurry of people looking to switch already over the last couple of weeks.
"The ECB won't directly affect the banks funding but it is part of the overall cost of their funding model so it's good news for all borrowers - people looking to get a mortgage and people who already have a mortgage."
