🏠 Mortgage pain spreads across major housing markets

Mortgage demand is weakening in the UK, Australia and the US as borrowing costs stay high and buyers delay decisions. The latest data suggest housing affordability is now acting as a direct brake on transaction volumes rather than a short-lived cyclical drag.

In the UK, Bank of England figures showed net mortgage approvals for house purchases fell to 53,400 in September, the weakest level since 2023. In Australia, the Reserve Bank lifted its cash rate to 4.85%, an 18-year high, while Westpac said mortgage applications dropped 15% in the September quarter from a year earlier. In the US, the average 30-year fixed mortgage rate eased for a third straight week but remained at 7.30%, still high enough to suppress purchase activity.

The data

The pattern across markets is consistent: financing costs remain elevated even where rates have stopped rising or have begun to ease. That is limiting affordability, slowing turnover and reducing the urgency to transact.

• UK mortgage approvals fell to 53,400, the lowest since 2023
• Australia’s cash rate increased to 4.85%, the highest in 18 years
• US 30-year fixed mortgage rates declined to 7.30% but stayed above 7%

What it means for investors

For investors, the immediate implication is a weaker near-term backdrop for residential transaction volumes, particularly in markets where household balance sheets are already stretched. Lower approvals and fewer applications typically translate into slower price growth, longer marketing times and greater sensitivity to incentives from sellers.

High borrowing costs are now suppressing housing demand even where price expectations are softening.

The comparative angle matters: the UK and Australia are feeling the pressure through central-bank tightening and mortgage stress, while the US remains constrained by mortgage rates that are falling only marginally from elevated levels. That combination points to a globally synchronized slowdown in housing liquidity rather than an isolated national slump.

Bottom line

The data signal that affordability constraints are becoming a structural force across major housing markets, with transactions and pricing power likely to remain under pressure until borrowing costs fall more decisively.