In a recent statement, Mary-Lou Press, the President of NAEA Propertymark, discussed the potential effects of easing mortgage rates on the housing market. She noted that after enduring several years of affordability challenges, the possibility of lower mortgage rates could offer some relief and spur modest growth in house prices. However, Press emphasized that many buyers still face significant obstacles.
Press stated, “Easing mortgage rates will be welcome news after several years of affordability pressures and could support modest house price growth without significantly worsening buyer affordability.” Despite the positive outlook that lower rates could bring for first-time buyers by helping them manage rising prices, she pointed out that hefty deposits and limited income remain substantial barriers for many prospective homeowners.
Press also highlighted that home movers and those refinancing their mortgages, who generally have more equity, are in a better position to take advantage of lower rates. “Lower rates remove a headwind rather than transform the market,” she added, noting that real, lasting improvements in housing affordability are reliant on stronger wage growth and an increase in housing supply.
The sentiment surrounding easing mortgage rates is cautiously optimistic; while it provides a glimmer of hope for buyers, it is clear that additional systemic changes are necessary to create a more accessible housing market.