Rightmove’s report states that one of the most pressing concerns in the current property market is the elevated interest rates, which are continuing to stretch affordability. Now, all eyes are on the Bank of England’s next meeting in August.
According to Rightmove, financial markets expect the first Base Rate cut to occur in August or September. This is encouraging news, but these forecasts may change in the coming weeks. The first Base Rate cut in four years, combined with the renewed political certainty post-General Election, could set the backdrop for a booming Autumn market.
Rightmove’s Director of Property Science, Tim Bannister, said: “A Base Rate cut is expected to lead to lower mortgage rates, which could be the game-changer for some would-be home-movers who are being held back by significantly higher monthly mortgage costs. The average five-year fixed rate is still nearly twice as high as it was before the first of 14 consecutive Bank of England rate increases in 2021, with rates staying elevated for much longer than many thought that they would. A first Base Rate cut for over four years, together with the new political certainty, could set the scene for a positive Autumn market, with improved affordability and a more confident outlook in the second half of the year.”
