Estate agents and mortgage experts have reacted to the Bank of
England’s surprise decision to keep base rate unchanged at 0.5 per
cent - and almost everyone says a cut is on its way next month,
even if it has not happened now.
“A reduction is still on the cards. The Bank of England is
preparing its next forecast and will have the benefit of
post-referendum data for its next meeting in August. It will be
able to make a more informed decision on the extent of measures to
stimulate the economy and calm post-referendum nerves by then”
explains Fionnuala Earley, chief economist at the Countrywide
“There are many first-time buyers already taking advantage of very
low mortgage rates. If a rate cut comes next month, it will give an
additional boost to those who may have been thinking twice about
jumping onto the property ladder at the present time” says Jeremy
Leaf, north London estate agent and a former RICS chairman.
On the mortgage front, there is also widespread belief that a cut
remains likely over the summer.
“Lenders are already factoring a rate cut into their pricing, with
Santander increasing the premiums over base rate on some new
products to protect its margins in readiness of a rate cut.
Meanwhile, Scottish Widows increased the margin on its new trackers
by 35 basis points” insists Mark Harris, chief executive of
mortgage broker SPF Private Clients.
“The message from lenders is that it is business as usual. They
wish to improve their volumes, which are lower than they want them
to be because of uncertainty around the referendum. This is good
news for first-time buyers, home movers and those remortgaging as
the mortgage market is set to become even more competitive” he
The Bank of England yesterday kept its base rate to 0.50 per cent
despite many analysts expecting it would be cut to 0.25 per cent in
what would have been the first change in over seven years.
Seeking advice on Mortgages, why not speak to Brendan Brown
Independent Financial Advisor for JP & Brimelow.
T. 07764 942896