Interest rates remain a pivotal factor for property affordability and market momentum. Over the past few years, higher rates have increased financial strain on households, particularly those with mortgages two or three times higher than before. However, forecasts suggest potential rate cuts by mid-2025, albeit slower than some might hope. The pace and extent of these cuts will depend on inflation trends and government fiscal policies, especially in an election year.

Inflation, while trending downward, still affects the property market significantly. During periods of inflation, real assets like property tend to appreciate. For those with mortgages, high inflation can also erode the real value of debt over time, provided they can service it.