Mortgage rate concerns have seen a +508% spike in online searches, according to new research by Better.co.uk.
Following the impact on the financial markets of the mini-budget last year, new research from Better.co.uk reveals the most searched concerns of UK property buyers and homeowners.
Better.co.uk were able to analyse Google search volume data between November 21 and November 22 to reveal which concerns were keeping Brits up at night.
With the volatile market, it’s no concern to see both mortgage rates and interest rates make the top three mortgage concerns in the country. Searches around mortgage rates have increased by 508%, up to 110,000 average monthly searches.
It’s important to note that 60% of all these mortgage rate searches are found to be of negative sentiment.
The biggest concern overall is house prices, which see an average of 135,000 searches a month.
Online queries around interest rates have also increased by 233% to 90,500 average monthly searches. This makes them the UK’s third most pressing concern. Almost one in three of these searches (31%) also feature negative sentiment.
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Top 10 Biggest Financial Concerns Across the UK
| Concern | Avg. Monthly Searches | 3-Month Change | YoY Change | Negativity % Increase | Negative % Sentiment | |
| 1 | House Prices | 135000 | 22% | 172% | 144% | 26% |
| 2 | Mortgage Rates | 110000 | 235% | 508% | 303% | 60% |
| 3 | Interest Rates | 90500 | 22% | 233% | 303% | 31% |
| 4 | Stamp Duty | 90500 | 83% | 50% | 303% | 8% |
| 5 | UK Inflation | 74000 | -18% | 83% | 295% | 49% |
| 6 | Solicitors | 74000 | 22% | 22% | 110% | 52% |
| 7 | Energy Price Cap | 60500 | -63% | 173% | 54% | 9% |
| 8 | Home Deposits | 60500 | 0% | 0% | 144% | 21% |
| 9 | Energy Bills | 27100 | -63% | 819% | 54% | 55% |
| 10 | Buying A House | 22200 | -18% | -18% | 110% | 44% |
Of course, with such concerns, is this a good time to buy a house?
Head of Mortgage Sales Sam Amidi answers whether house prices falling is a good or bad thing, especially when it comes to selling.
“Given the cost-of-living crisis, buyers are unable to stretch to afford the high cost of property at the moment. Halifax and Lloyds have therefore predicted that there could be a house price drop of around 8% in 2023.”
“This could be good for homebuyers, although house prices are still steep and so are mortgage interest rates. In fact, mortgage rates are likely to keep going up.”
“For sellers, the house price drop is not such good news. It will mean that they have to ensure they do not overestimate the value of their property. If in the process of selling, the property is down valued during the valuation, it will only slow down the process as the buyer may wish to renegotiate the selling price.”
“Whether now is a good time to buy a house is up to the buyer and their own circumstances. Buyers should take into consideration:
- Mortgage rates and repayment costs as rates are expected to keep on rising in line with inflation. So buyers should keep in mind that a small saving on the final house price may be cancelled out by high mortgage repayment costs.
- The size of their deposit as those putting down a smaller deposit could find themselves in negative equity should home prices drop significantly in the next two years.
- Whether they intend to sell in the next couple of years as they could find that their house is worth less than it was purchased for when they go to sell.
- Those with lower household incomes will feel the strain when it comes to higher mortgage rates and repayments. This on top of the cost-of-living crisis will put financial pressure on households with lower incomes.
“Rising interest rates will make it more expensive to borrow and difficult to secure an affordable mortgage deal. This may deter many homebuyers from looking to buy in the current market. As mentioned above, it is also expected that house prices will drop, meaning that sellers may not get what they think their home is worth.”
Sam Amidi also explores the concerns of inflation rises in the UK, by addressing what will happen should numbers continue to climb:
“The immediate impact of rising inflation is that lenders will limit what people can borrow when applying for a mortgage. Lenders take the cost of living into account when assessing buyers’ ability to repay their mortgage each month and this figure is tied to inflation.”
“This could also affect any buyers with an existing mortgage in principle, as they may find that they can borrow less than they were originally told because affordability measures are linked to inflation.”
“This rise in Inflation will not immediately affect monthly mortgage payments. However, if the Bank of England raises interest rates to try and curb inflation, which can be a common response, this will impact householders who are currently on Standard Variable Rates (SVRs).”
For Brits looking for better deals, the option seems to be a bigger deposit. Understandably, this won’t be what many people want to hear right now. Sam highlights:
“Having a bigger deposit gives you access to a better range of mortgage deals with lower interest rates, a deposit of 20% is a good place to start. The current financial climate will make it harder for many people to save towards buying a home, but not impossible.”
“There are various ways people can save money, such as moving back with family or analysing their monthly costs and making cuts. Using a scheme like a Lifetime ISA or Shared Ownership can also be of help when it comes to putting money aside for a house deposit.”
Tom is a Digital Content Writer passionate about sustainable property & property trends. Regardless of the subject, he will always write blogs of the best calibre. Read more about Tom here.
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