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The Bank of England has decided against a further Base Rate Rise. After fourteen consecutive increases, what does this mean for your mortgage and the market as a whole?  

Today, the Bank of England decided to keep the Base Rate (BBR) at its current level of 5.25%. The announcement is a shock to many experts who, despite yesterday’s surprise inflation news, still favoured the chances of a 0.25% increase. However, regardless of your predictions, this is good news.  

Following fourteen consecutive Base Rate rises, the first of which was an increase from 0.1% to 0.25% on the 16th December 2021, landlords are now hoping for the much-needed stability in the money markets. 

In the two years since the first rise, the Bank of England has tackled unprecedented rising inflation against the cost-of-living crisis, Trussonomics, the Russian war against Ukraine, and, more recently, US inflation levels. Money market volatility has seen mortgage interest rate pricing increase significantly over this time period, so what can landlords now expect from the market and for their mortgage interest rates? 

What can we expect going forward?  

Even before the surprise drop in inflation in August, industry experts were unanimous that today’s announcement would mark the end of consecutive Base Rate rises, whether there was an increase or not. Confidence is returning to the money markets, and inflation continues its downward trajectory, gathering pace from Q4 this year, offering a brighter outlook for Buy to Let Landlords

Looking forward, it’s unlikely we will see any decreases in the Base Rate until late 2024 at the earliest. Alongside positive inflation forecasts, we expect a period of stabilisation in BBR before cuts amounting to 0.75% by the end of next year, leaving the Base Rate at 4.5% by the end of 2024. 

What this means for your mortgage 

Fixed-rate mortgages  

If you’re approaching your remortgage, now’s the time to explore your options. Lenders and the money markets will mostly have priced in a Base Rate rise today, so we can expect to see mortgage rates come down over the next few days. Specialist lenders will want to see the market’s reaction over the next twenty-four hours, so Monday and Tuesday should be lively in terms of pricing changes!  

Positively, we are seeing lenders starting to soften their product pricing in general. Whilst interest rates will not return to the competitive lows we saw post-pandemic, landlords should be reassured that mortgage pricing has now peaked and is settling to a new ‘normal’ level. 

It may be worth contacting your broker if you secured a higher mortgage interest rate and are yet to complete. Many lenders (although not all) will allow you to switch to a lower rate before completion, so it’s important you speak to your broker, as you may still be able to save money. 

Tracker or Variable mortgages 

Today's news may tempt you to sit on your current rate if you’re on a tracker or variable mortgage that tracks the Base Rate. However, as lenders continue to review their criteria and slowly soften their mortgage interest rate pricing, it’s worth exploring whether you could access a more competitive option. Fourteen consecutive Base Rate rises will have significantly driven up your monthly repayments, so it’s worth discussing your mortgage with an expert broker to see if fixing is now a viable option.  

To discuss today’s Base Rate news or explore your next property finance options, contact our brokers on 0345 345 6788 or submit an enquiry here 

Search and compare mortgage rates

To review your mortgage options and see what types of rates you could access for your own home or for your property investments, head over to our mortgage calculator page. Or you can speak to one of our expert mortgage brokers by calling 0345 345 6788 or submit an enquiry here.

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