Global Mortgage Pressures
Rising Mortgage Rates Squeeze Buyers and Pressure Global Housing Markets Worldwide
Anonymous
Mortgage costs are rising across several markets, squeezing buyers and pressuring housing-related businesses. In the United States, the average 30-year fixed mortgage rate reached 7.5%, its highest level since April 2024, weighing on affordability and contributing to declines in homebuilder and home-improvement retailers’ shares. In Australia, expected further central-bank rate increases could raise mortgage bills and deepen a housing downturn, while affordability is already at a record low. In Canada, higher bond yields are pushing fixed mortgage rates up and threatening a hoped-for housing recovery amid weak buyer confidence and economic uncertainty. Nigeria’s market has adapted to high rates and construction costs with phased projects and smaller homes, while strong demand and rental growth persist.
Key Points
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In the Bay Area, Realtors Association President Michael Gordon said buyers are adapting to higher rates by temporarily lowering budgets, using retirement funds or selling stocks, and bringing more cash to purchases.
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U.S. home-improvement retailers were hit particularly hard: Home Depot shares fell 11% and Lowe’s 8.5% during the month as renovators shifted toward smaller, cheaper products.
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Australia’s anticipated cash-rate rise to 4.6% would add about A$100 a month to interest payments on a A$700,000 mortgage; economist Shane Oliver warned that further increases could risk a 15–20% fall in home prices rather than a 10% decline.
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In Canada, mortgage planner David Larock said fixed mortgage rates may face further increases as pandemic-era renewals pass and lenders’ competition eases; he noted that normalizing lender spreads could require another quarter-point rise.
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Nigeria’s report said constrained affordability is driving rental housing growth and pushing demand into suburban areas, including Ibeju-Lekki, Mowe and satellite towns around Abuja.
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