Interest rates have risen for the 14th consecutive time as the Bank of England continues its attempt to tackle inflation
The Bank raised its Base Rate at the start of August by 0.25% which has pushed interest rates to 5.2% - the highest for 15 years.
There are signs that the inflation rate is starting to come down with figures in the month to June showing a drop of 0.8% to 7.9%; still a long way off the 2% target set by the Government.The slight drop in inflation has resulted in a small fall in mortgage rates with experts predicting further drops over the next few weeks.
Matt Smith of Rightmove said: “The rate increase was much anticipated by lenders and has been largely factored into mortgage rates already. As such, we expect mortgage rates to fall slowly over the next few weeks. June’s more positive inflation numbers have given the market renewed confidence that inflation will continue to fall and that the base rate won’t have to go as high as previously feared, meaning lenders can tentatively start to reduce rates. All eyes will be on July’s inflation figures which will be published shortly.”
Ben Furnell of Furnell Residential commented: “All the talk about inflation rates and interest rates provides little in the way of confidence for the housing market which is already going through its traditional summer lull.
“People on variable or tracker mortgages are seeing their payments increasing month on month and those on fixed deals will be impacted further down the line. It is imperative that the mortgage lenders start helping borrowers by reducing rates if inflation does start to fall as analysts predict.
“We are always available for anyone considering selling or buying and will offer the very best advice on how current market conditions should be factored into their decision making.”
Furnell Residential is a family owned estate agency covering North Leeds, Wetherby, York, Harrogate and surrounding areas.