As the latest Moneyfacts data reveals a modest uptick in mortgage rates, questions are once again being asked about the property market’s direction, and how sensitive buyers may be to even small changes in borrowing costs.
In this week’s Friday Focus, Nathan Emerson, CEO of Propertymark, reflects below on the implications of this movement and what it could signal for the months ahead. With affordability remaining a central concern, especially for first-time buyers, his analysis explores how agents, buyers, and sellers alike can adapt to shifting conditions.
The recent rise in mortgage rates, while small, is a timely reminder that the property market remains closely tied to wider economic conditions and sentiment. Even marginal increases in borrowing costs can have a knock-on effect on buyer confidence, especially after a period where many were beginning to feel more optimistic about affordability and stability.
While we don’t yet view this as the start of a sustained upward trend, any further rate rises could prompt some potential buyers to pause or reassess their plans, particularly in more price-sensitive segments of the market. This could lead to a short-term cooling of demand, especially among first-time buyers and those stretching to meet affordability criteria.
In the medium term, the property market will be influenced by the balance between interest rates, wage growth, inflation, and overall economic confidence. If mortgage rates continue to fluctuate, we may see renewed hesitancy from buyers and sellers alike, reinforcing the importance of realistic pricing and clear guidance from property professionals.
For agents, this is a time to stay close to clients and provide grounded advice based on local market conditions. Ensuring sellers understand current buyer expectations and helping buyers navigate affordability challenges will be key. It’s also important to remember that underlying demand remains strong in many areas, and well-presented, correctly priced properties are still attracting serious interest.
Ultimately, while this rate movement is worth noting, the property market continues to show resilience, and with the right support, buyers and sellers can still make confident, informed decisions.
