One of the biggest drivers of that change has been mortgage interest rates. Interest rates aren't the only driver of the property market, but they are one of the most important because most property transactions are highly leveraged. So changes to interest rates, whether up or down, have an almost immediate impact on borrowing levels and prices. From there interest rates have risen precipitously and the average two year fixed rate reached 5.47% in September this year. If they had a 20% deposit, mortgage payments as a percentage of income would have risen from 20.7% to 34.8% over the same period.

Source: Stuff October 23, 2022 02:01 UTC