New figures from the Central Bank show that the average interest rate on new Irish mortgages fell to 3.97% in November - the lowest rate since May 2023.
The equivalent euro area average decreased by nine basis point to 3.43% in November.
Irish mortgage rates continued to be the sixth highest in the euro area for the fifth month in a row in November.
Today's Central Bank figures also show that the total volume of new mortgage deals decreased to €1 billion in November, a €40m or 4% decrease in monthly terms and a €176m or 20% increase from November 2023.
Meanwhile, interest rates on household overnight deposits remained stable at 0.14% in November 2024, the highest rate since November 2017.
The weighted average interest rate on new household deposits with agreed maturity decreased to 2.6%, which compares to the equivalent rate in the euro area of 2.61%.
Trevor Grant, chairperson of Irish Mortgage Advisors, said the fall in the average interest rate on new mortgages is a trend that should continue this year given the recent ECB rate cut in December - and signals from the ECB that it has left the door open for future cuts.
"Markets are forecasting another four ECB cuts this year - with most of them expected in the first six months of 2025. This could see the average interest rate on new mortgages drop substantially in the coming months," Mr Grant said.
"While it must be remembered that Irish home-loan mortgage rates are unlikely to fall to the same extent as any ECB rate cuts because home loan rates have not increased at the same levels as the ECB rate had between July 2022 and September 2023, and because banks are under pressure to increase returns for their savers, in time, falling ECB rates should make their way to variable and fixed rate mortgage customers," he said.
"The recent fixed rate mortgage cuts announced by a number of banks is evidence that this is already happening. Indeed, we could see multiple fixed and variable mortgage rate cuts this year. Homeowners and house hunters should get ready to make the most of these falling rates," he advised.
