A Steady Ship: How the market is reacting to the BOE’s rate decision

As we move forward from last week’s decision by the Bank of England to maintain interest rates at 5.25%, the highest in 16 years, the property market is beginning to show signs of positive momentum.

Market Reacts to Steady Interest Rates
The stability brought by the unchanging base rate is already proving to be positive for the property sector. With many industry experts taking a more upbeat stance, driven largely by a resurgence in buyer demand, a dip in mortgage rates, and encouragingly, a revival in house price growth.

Lenders Adjusting to Market Dynamics
In response to the Bank’s announcement, we’ve observed a steady but positive reaction from mortgage lenders, with many opting to reduce their rates. This strategic adjustment aims to stimulate further growth and activity within the market, making it an opportune time for buyers and investors to reconsider their options.

Barclays and Bank of Ireland have cut selected rates. And HSBC has said it will cut rates on two, three and five-year fixed rates for home purchase at 90% to 95% loan to value (LTV). However it is worth noting that deals at 85% LTV and lower LTV ratios will increase.

Spotlight on Buy to Let Mortgages
A noteworthy development in the buy to let sector is “The Mortgage Works” introducing more competitive rates, leading the charge with a sub-4% mortgage offering.

Starting 26 March, landlords can access a 3.99% five-year fixed rate mortgage at a 55% loan-to-value (LTV) ratio, albeit with a 3% fee. While options for mortgages with lower deposits or fees still hover above the 4% threshold, this marks a significant move towards more favorable terms for property investors.

Aldermore, has also revamped its BTL range and launched two five-year fixed rate products for remortgage, while cutting rates on other selected deals by 0.1 percentage points.

That being said, Accord, part of Yorkshire building society group, is bucking the trend for lowering rates by increasing its two and three-year fixed rates on BTL product transfer deals (deals for existing borrowers looking for a new rate).

With our “FlexiLock” service, we will search the market for the most suitable product for you and continue to monitor this right up until the product goes live.

Looking Ahead
As the market responds to the steady interest rate and lenders adjust their strategies, the coming weeks could present valuable opportunities for both residential and investment property transactions. Whether you’re considering entering the market or adjusting your investment portfolio, the current climate is ripe with potential.

Our experienced brokers will liaise with you multiple times before the product goes live. And if we find a lower cost or more suitable product for your circumstances, we will switch the product over.

In practice this means cancelling the rate we had secured and swapping over to the improved rate. This is done with no extra charge to you.

Speak to our award winning mortgage brokers
Get in touch now on 0208 364 3444 alternatively click here to schedule a free consultation call. Be sure to ask about our Flexi-Lock service to ensure you can lock in the best rate.

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