Despite rising inflation, the Bank of England has held the base rate in April’s review. In addition, mortgage rates have eased slightly.
The Bank of England has held the base rate at 3.75% in the base rate review on 30 April. The rate was previously held at the last review on 19 March, which signalled a period of caution. The conflict in the Middle East has resulted in uncertainty.
Ongoing conflict in the Middle East has pushed up global energy prices, and we’re now seeing the knock-on effect in fuel and household costs. Inflation remains stubborn. The latest figures from the Office for National Statistics show consumer price inflation rising to 3.3% in the 12 months to March, up from 3% in February – a three-month high. We may see this edge higher over the summer.
‘Despite inflation pressures, the Bank of England clearly didn’t want to increase the rate, but they will be keeping an eye on inflation,’ says Les Pick, MB Associates’ Sales & Operations Director. ‘The Bank’s job is to ensure that higher inflation isn’t a long-term issue. They will no doubt be monitoring the situation very closely.’
Mortgage rates easing
Interestingly, despite the conflict, we’re starting to see a shift in lender behaviour. Mortgage rates went up when the war first started, but now they are coming down again. Some lenders have reduced their rates slightly, with average fixed rates edging down.
Several major lenders – including Barclays, HSBC, Lloyds Bank and Santander – have already made cuts, with others such as Halifax, Leeds Building Society and Coventry Building Society following suit.
Get prepared to remortgage
If you’re due to remortgage, now is the time to act. We can secure the most competitive rate available for you now and continue to monitor the market. If a better deal becomes available before your new mortgage starts, we can resubmit your application. However, it’s advisable to lock in a rate now, in case circumstances change and rates go up.
Despite the conflict, the housing market has remained resilient. According to Zoopla, the average time to sell a home has increased by just one day compared to last year, with properties still selling at a similar pace across more than half of UK regions. People are still looking for properties and have an appetite for buying.
If you have any questions about your mortgage, we’re here to help.