As widely predicted, the Bank of England has reduced the base rate today by 0.25%, to 4.75%.
This follows the recent news that inflation reduced to under the target of 2% in September, which is the first time this has been achieved in over 3 years.
It will certainly be interesting to see what happens going into 2025, with projections for further cuts now being scaled back following the US election result, while we wait to see what impact the new government’s economic policies have on exports and inflation.
In terms of the mortgage market, anyone on a variable rate mortgage will see a reduction in their rate following this cut, with tracker mortgages reducing immediately.
If you are on a standard variable rate or discounted rate with your lender, you should hopefully see a reduction in due course, but this is each individual lenders discretion.
New fixed rate mortgages won’t necessarily reduce on the back of this news as their rates aren’t based directly on the base rate. In fact, we have seen some rate increases in recent days from some of the major high street lenders, but this may well be just a blip to control the volume of applications they are receiving. We certainly don’t expect significant changes, either way, in the short term.
If you need any advice, please get in touch with a member of Barlow Irvin Financial Services award-winning mortgage experts on 01204 304 814.
As a mortgage is secured against your home or property, it could be repossessed if you do not keep up mortgage repayments.