Consumer Interest in Mortgages Is Down 34% In the Last 2 Months
Mortgages are an essential part of the buying process for many people and a major factor in determining their lifestyle. Consumers primarily focus on finding a mortgage that allows them to make a manageable monthly payment with enough left over to cover other expenses. With the current economic downturn due to COVID-19, consumer interest in mortgages has seen a 34% decline between 11th October and 11th December 2022 according to MoneyTransfers.com. The site reports that the term’s search volume dropped from 83% to 55% in the stated period.
The data is based on a Google Trends report which measures search interest intensity across various topics. It’s important to note that this is not necessarily an indication of actual mortgage applications or refinancing requests; rather, it reflects the level of interest people express when they use search engines.
MoneyTransfers CEO Jonathan Merry recently spoke of the decline of search interest in mortgages. He voiced his concerns that a lack of search activities may indicate individuals shying away from such investments, perhaps subject to other pressures. Merry holds,
Mortgages are important financial instruments, and a decline in their search interest suggests an underlying economic problem. With prices of homes and other real estate increasing at an unsustainable rate, there’s no surprise why more people are apprehensive about searching for these opportunities.
MoneyTransfers CEO Jonathan Merry
So What Could Be Causing This Drop-Off?
This development could be symptomatic of broader economic trends which suggest slowdowns in credit availability or reduced consumer spending power. Furthermore, there could be social factors at play. For example, with the rising cost of living, people may no longer have enough disposable income to make large investments like buying homes or taking out large loans.
It also indicates a shift in public perception towards mortgages as an investment option overall; with stock markets being seen by many as more viable investments during uncertain times than traditional housing options, people may be more likely to look into those kinds of things instead.
One possible explanation could be rising or changing interest rates which may make obtaining a loan more difficult or less attractive to potential buyers. This would result in fewer people researching available options or taking steps to acquire financing for their purchase.
Understanding Consumer Expectations
Consumers will always be looking for ways to save money and ensure that their monthly mortgage payments are manageable. This means lenders need to understand their customers’ needs and create sound strategies for providing competitive mortgage solutions that meet these expectations.
The recent data indicates that the market is becoming increasingly competitive as consumers are more aware of their various options. Lenders must ensure they can provide a range of attractive offerings to remain competitive in the market. This can be done by presenting a variety of solutions that take into account different levels of borrowing and repayment plans, as well as offering more favourable terms for those with good credit ratings or those who have had their mortgage for some time.
The decline in consumer interest in mortgages could have far-reaching implications for the mortgage industry. It is important to be aware of this trend and take steps to mitigate it.
