Homeowners seeking to reduce their bills have sparked a huge 150% increase in mortgage switching in the past year.

In the weeks before the European Central Bank announced the first increase in interest rates in 11 years, thousands of homeowners moved to a fixed rate.

The base rate set by the ECB went up from 0% to 0.5% just two weeks ago, and further increases from September on have been flagged.

New figures from June show a massive rush of 2,720 borrowers fixing their mortgage deal. Trevor Grant, chairman of the Association of Irish Mortgage Advisors, said yesterday: "Switching has been gathering pace for some time now with a 150% increase in the volume of mortgage switching year on year to June 2022. This latest development was the kickstart that many mortgage holders needed to reassess their current mortgage terms."

Many Irish banks have not followed through with an immediate hike to rates. Finance expert Brendan Burgess, of Askaboutmoney.com, said Irish banks could cut their rates and still have higher rates than most of the rest of the eurozone banks. At 2.68% in June, the average interest rate on a new mortgage in Ireland is the second highest in the 19-country eurozone. However, this rate is down from 2.73% in May and 2.77% in April.

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For the second month in a row, Ireland was the only country in the eurozone to see a fall in its mortgage rates. All other countries saw a rise in their average rate, some of which were significant.

France now has the lowest average mortgage rate in the Eurozone at 1.34%, followed by Portugal at 1.48%.

The eurozone average is 1.90%, its highest level since at least August 2017.

Daragh Cassidy, of utility switching site Bonkers.ie, said: "All the major lenders have said they won't be passing on the hike... for now. So later in the year we could see Ireland having rates very close to the eurozone average."