HOUSE PRICES FALL AS IRAN WAR PUSHES RATES – Rising mortgage costs driven by geopolitical tensions weigh on housing demand and values
House prices have come under renewed pressure as rising geopolitical tensions linked to the conflict involving Iran feed through into global financial markets and push up borrowing costs. Mortgage rates have climbed in recent weeks as investors price in higher risk and increased volatility, leading lenders to tighten conditions in some parts of the market.
Economists say the impact is being felt most sharply in interest-rate sensitive housing sectors, where affordability was already stretched following previous rounds of monetary tightening. Higher yields on government debt, often used as a benchmark for mortgage pricing, have added further upward pressure on lending rates, reducing buyer demand and slowing transaction activity.
Analysts warn that if geopolitical tensions continue to escalate, borrowing costs could remain elevated for longer, weighing further on house price growth. However, some property experts note that supply shortages in key urban areas may help limit the scale of any broader price declines, even as demand softens in the near term.
