Ireland’s economy has been hailed as the so-called Celtic Tiger in the early 2000s, with its booming property market and job growth. However, in recent years, many Irish citizens are feeling the squeeze of what has been dubbed the “new squeezed middle”. The latest victim in this demographic are borrowers with tracker mortgages. While these mortgages were once an attractive option for Irish homeowners, they are now facing the reality of rising interest rates, leaving many families struggling to pay off their loans. In this article, we will explore the impact of these rising interest rates on Ireland’s new squeezed middle and their struggle to make ends meet.
The cost-of-living crisis has impacted many in Ireland, with utilities and grocery bills being affected by inflation. However, housing is the main concern for Irish people, with 52% citing it as a key issue compared to the EU average of 8%. Renters are the most vulnerable, facing potential evictions and homelessness or unsuitable living conditions due to unaffordable prices and a lack of supply. Homeowners and those wishing to buy are also facing challenges, such as interest rate hikes, price increases, and supply shortages. The European Central Bank (ECB) has raised interest rates to achieve an inflation target, causing financial strain for muitple groups of people. The Irish government has not taken much action to address rising costs in the housing market, but may consider measures to help homeowners depending on budget developments. Online mortgage brokers and economists have emphasized the difficulties faced by homeowners and prospective homeowners, including rising monthly repayments and difficulty saving for a deposit.
As Ireland’s housing crisis continues to deepen, the squeezed middle have found themselves in incredibly difficult circumstances. The widespread use of tracker mortgages may have seemed like a good idea at the time, but it’s becoming increasingly clear that their long-term implications have been harmful to many families who find themselves struggling to keep up with rising repayments. While the government’s efforts to tackle the housing crisis are a step in the right direction, much more needs to be done if we are to address the underlying problems facing the squeezed middle in Ireland. Only through concerted action and a commitment to affordable housing can we ensure that future generations are not left facing similar struggles.
