Bank of England cut rates
The Bank of England (https://www.bankofengland.co.uk/) last reduced interest rates in August from 5.25% to 5%, marking the first cut since March 2020.
Industry experts have stated that the cut from 5% to 4.75% signals confidence from the Bank. This should reassure buyers and encourage them to continue with their property plans. However, the Budget may be putting the brakes on the pace of future cuts.
Geoff Flewers, co owner of Jukes Estate Agents Harlow, says: “It’s a significant week for the property market with the Budget, the US election, and now the Bank of England’s interest rate decision.
“The August rate reduction boosted buyer confidence. This has lead to an uptick in applicant registrations, viewings, and offers. This contributes positively to our fourth quarter revenue. A further rate drop would likely encourage more vendors to sell and buy, helping to ‘get people off the fence.’ With likely further reductions throughout next year, this should provide stability, giving people the confidence to plan, which is essential for maintaining market momentum.
“With the Budget behind us, we now have greater certainty. Homeowners without second homes may feel encouraged by a rate drop, though those with holiday homes or rental properties may wait for further rate cuts before re-entering the market.
“We are cautiously optimistic but concerned about the future stamp duty rate change for first-time buyers. Do they realise how long it takes to complete a purchase? If the mortgage market reacts positively to today’s reduction, first-time buyers should seriously consider making their move to agree on a purchase now, as delays could prove costly.”
JUKES ESTATE AGENTS HARLOW PREDICTED EVERY MOVE THE BANK OF ENGLAND MADE.
Jukes Estate Agents Harlow were invited to a meeting with the Bank of England about 13 months ago. If you look back at many blogs that Jukes wrote on the subject, their predictions have been 100% correct to date!
Geoff Flewers, the co owner of Jukes Estate Agents Harlow takes up the story. ” To be fair, all we have done is tell you what the Bank of England told us. I have watched the news with a smile on my face. Those at the meeting with the bank were told that there would be two rate cuts in 2024. The first from 5.25% to 5%. Then a second from 5% to 4.75%.”
What does 2025 hold?
Geoff continues: “The Bank of England suggested that 2025 would see 2-3 further cuts that would see the base rate at between 4%-4.25%. They would then like to see it lowered to 3.75% where they suggested they would be happy for it to stay at assuming inflation was still under control.”