Is this as good as it gets for variable Rates??

Discussion in 'The Fair Mortgage Rates Campaign' started by Techhead, Oct 5, 2018.

  1. Techhead

    Techhead Frequent Poster

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    Do we think variable rates are going to go down any further at this point? .. I accept there are good fixed rates on the market(UB for one) but what about variables?...
    Can this be really as good as its going to get?... Slow climb back to 5% when ECB gets it act together?
     
  2. RedOnion

    RedOnion Frequent Poster

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    AIB is the only bank completing on variable rates.
    The other banks want fixed rates. Bank of Ireland for example have publicly stated this policy. But the actions of the others shows they are following similar policies.
    I can't see any reductions happening on SVRs.
     
  3. Coldwarrior

    Coldwarrior Registered User

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    Do you think there'll be any more cuts in fixed rates?
     
  4. RedOnion

    RedOnion Frequent Poster

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    Yes.

    Note: I don't work in mortgages in any bank, so I've no inside information in this. These are my personal opinions.

    I believe competition will continue to bring rates down slowly. We will see more rates in the low 2% EFFECTIVE rates, competing with UBs 2.3% rate.
    But, as CBI restrictions limit LTV in mortgages, those with large cash back offers will hold market share without reducing headline rates dramatically, so I can't see anything sub 2% happening in next 6 to 9 months.

    It'd be good to see sub 3% 10 year rates; a BOI reduction to 3%, while maintaining current cashback would bring the effective rate under 2.7%. I think that scenario is more likely than a sub 2% short term rate.
     
    Coldwarrior and Balfour like this.
  5. gnf_ireland

    gnf_ireland Frequent Poster

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    I would question the value in variable rates at the moment. The big issue in the past was you were not able to break out of the fixed rate without heavy penalties plus it was very difficult to overpay the mortgage while on a fixed rate.
    These two issues appear to be simplified at the moment, and most banks offer generous over-payment options. The method of calculating fixed break-fees has been standardised, so that is also a plus.

    But to answer your question, I think the answer is yes, the banks want fixed rates - but the fixed rate products on offer differ from the products of old !
     
  6. gnf_ireland

    gnf_ireland Frequent Poster

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    KBC had a 2.95% 10 year rate a while back but has increased it slightly to 3.15% or so at this stage. The person I spoke to in KBC said the take-up was very poor

    But agree, I think sub 3% 10 year fixed rates are more likely than sub 2% rates in the short-medium term