Main findings:
- 67% are worried that interest rate hikes will affect their ability to buy – a 20% rise since March
- 58% now looking to secure a mortgage of over five years, while three-quarters seeking fixed-term mortgage
- Just a quarter (24%) believe there is enough supply on the market to secure a suitable property
- Of those who are planning to renovate or build, three-quarters (74%) have seen their plans affected because of cost of living crisis
- 75% worried about the state of the property market in general
- 87% believe the Government could do more to help the property sector
- Just 11% were satisfied with the housing measures introduced in Budget 2024
A new survey has suggested that rising interest rates and ongoing supply problems are having a particularly negative impact on property market sentiment.
According to the survey of 2,520 people conducted in late October 2023 by leading property website MyHome.ie, two-thirds of respondents (67%) say they are worried that interest rate hikes will affect their ability to buy. This figure has risen by 20% compared to March this year when respondents were asked the same question.
Interest rate hikes appear to have spooked those looking to secure a mortgage, with over half (58%) now looking to secure a mortgage term of over five years. Moreover, 75% will look to secure a fixed mortgage, and just 5% are seeking a tracker mortgage.
Meanwhile, even though demand remains strong, the market’s ongoing supply problems are a major concern. Six in ten respondents have finance secured to purchase a home, yet just a quarter (24%) believe there is enough stock on the market for them to secure a suitable property.
The vast majority of respondents (87%) believe the Government could do more to help the property sector, and just one in ten (11%) were satisfied with the housing measures introduced in Budget 2024 earlier this month.
Nearly three-quarters (73%) of respondents will look to power their home with renewable energy due to high energy costs, however of those who are looking to renovate or build, a similar percentage (74%) have seen their plans negatively affected by the cost of living crisis.
Overall sentiment is still poor, with just 14% saying they believe the next year will represent a good time to buy property. Meanwhile, 75% are currently worried about the state of the property market in general.
Joanne Geary, Managing Director of MyHome.ie, said: “The results of our March survey showed that energy price concerns dominated property market sentiment. Now, the focus has turned to interest rates and our ongoing supply problems.
“Given the sustained upward trajectory of interest rates, it is not surprising to see sentiment worsen, especially considering there is simply not enough supply in Ireland to satisfy demand. In short, there are too many prospective buyers battling over too few properties which are steadily costing more to finance. It’s not a reality that lends itself to positive sentiment.”
She said that it was encouraging to see that three-quarters of respondents will look to power their homes with renewable energy. “It is important that we look to build on this trend. It is notable that respondents are not happy with the Government’s interventions to date, so perhaps more affordable green initiatives could be introduced.”
She added: “From what we see from the latest CSO residential property price index, the continued slowdown in property price growth, most notably in Dublin, reflects this dampening customer sentiment. We welcome the recent extensions and changes to the Help to Buy and First Home schemes, as well as the grant available for vacant, derelict homes and for those looking to retrofit. These will hopefully assist some buyers in the market, albeit the main issue is still the lack of supply coming through.”
