Bank of England interest rate freeze opens the door to your new home

Following the recent decision made at the Monetary Policy Committee meeting of the Bank of England (BoE), borrowing rates remain unchanged at 5.25% for the month. This decision was closely debated after the decrease in both the Consumer Price Index (CPI) and Core Inflation.

For the first time in 14 meetings, there was no increase in interest rates, signalling a potential shift in direction. Market sentiment suggests that this could mark the end of the upward interest rate cycle, bringing in a period of stability, which bodes well for the housing and mortgage markets.

Change in direction creating competition

Anticipating this announcement, the SWAPS market, which deals in future interest rates, was already trending downwards. Consequently, some lenders have begun offering residential 5-year fixed products at under 5% once again. Following the Bank of England's decision, several other major lenders have also announced substantial reductions in their rates, bringing them below 5%.

This trend extends to the Buy-to-Let market, where a variety of great new competitive rates have become available.

The new normal

It's expected that mortgage interest rates will now stabilise between 4 and 5% for a period of time. This adjustment represents an improvement from the rates seen over the past two to three months. Prospective buyers and sellers should take into account the heightened demand for properties leading up to Christmas and the New Year, which could potentially lead to an uptick in prices.

Helping you

With the improved rates now on offer, borrowers not only stand to benefit from reduced borrowing costs, but may also find themselves able to afford slightly more. This means that the perfect first, or forever home, may now be within reach.

At Capital Private Finance we work to help you unlock your potential and to get the best value possible when buying your home.

If you would like to be guided through the mortgage maze to unlock your full potential and maybe even the door of your perfect new home, please get in touch with one of our team on the email link below.

Author:

James Keable
Mortgage Services Director
Capital Private Finance

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