Housing market in England and Wales weakening due to Iran war, say estate agents

Homebuyers more cautious due to possible mortgage rate rises and higher inflation as sellers sit on properties Fears of higher mortgage rates and rising inflation as a result of the Middle East conflict are leading to a subdued and downbeat housing market, according to estate agents. Demand from potential homebuyers across England and Wales has shown a “noticeable softening” recently, according to a monthly survey of estate agents by the Royal Institution of Chartered Surveyors (RICS). Members have told the professional body that buyers and sellers are becoming more cautious, and many agents have cited clients who are worried about whether inflation and interest rates will rise in the coming months, leading to slower sales, fewer homes on the market, and more price-sensitive buyers. The Bank of England warned last month that interest rates may have to increase in the coming months as “higher inflation is unavoidable” because of the war in the Middle East and resulting jump in oil and gas prices. At the same time, mortgage rates are likely to be affected by the current sharp rise in government borrowing costs, as swap rates – which lenders use to price their fixed-rate mortgages – t