{"id":6094524,"date":"2023-06-22T14:40:03","date_gmt":"2023-06-22T13:40:03","guid":{"rendered":"https:\/\/www.buyassociationgroup.com\/en-gb\/?p=6094524"},"modified":"2023-06-22T14:40:03","modified_gmt":"2023-06-22T13:40:03","slug":"interest-rate-propert","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-gb\/2023\/06\/22\/interest-rate-propert\/","title":{"rendered":"Interest rate hike: What are property industry insiders saying?"},"content":{"rendered":"

The Bank of England’s decision to increase its base rate to 5% has been labelled a “shock move”, so how are people in the housing industry responding to the interest rate ramp-up?<\/strong><\/p>\n

Earlier this week, it was confirmed that inflation in the UK was not falling as expected, sitting at 8.7% in the year to May. This was one of the main contributing factors that led to the Bank of England’s announcement<\/a> that it would once again be ramping up its interest rate.<\/p>\n

For some borrowers, particularly those on tracker mortgages or standard variable rates, this is likely to mean an increase to mortgage rates and monthly payments. Those on fixed rate mortgages will likely not feel the effects until their products come to an end.<\/p>\n

Of course, an interest rate rise affects many aspects of the economy as well as the housing market<\/a>, with borrowing becoming more expensive, while savers may find better rates now available.<\/p>\n

Reactions to the interest rate rise<\/h4>\n

Below are some of the first comments and statements on the latest interest rate hike, released by those operating in the UK’s housing market:<\/p>\n

Rachel Springall, finance expert at Moneyfactscompare.co.uk<\/strong>, said: \u201cBorrowers may be deeply concerned to see another base rate rise, particularly if they are sitting on a Standard Variable Rate (SVR) or are about to come off a low fixed rate.<\/p>\n

“Amid a cost-of-living crisis, rising interest rates can have a devastating impact on borrowers who are already struggling to cover their monthly essentials and could well lead to a rise of \u2018mortgage prisoners\u2019.<\/p>\n

“Those borrowers who are still on a competitive fixed rate deal for a few more years may want to consider overpaying their mortgage to reduce the size of their loan. However, those aiming to refinance on a fixed mortgage right now will find rates are around 3% more than they were a year ago.<\/p>\n

“Despite rising fixed rates, it\u2019s still worth considering a switch from a Standard Variable Rate for more peace of mind to guarantee the monthly mortgage payments, as the average SVR has risen to its highest point in over 15 years.<\/p>\n

“A rate rise of 0.50% on the current average SVR of 7.52% would add approximately \u00a31,576* onto total repayments over two years.<\/p>\n

David Postings, chief executive of UK Finance<\/strong>, said: \u201cLenders are ready to support customers who are feeling the strain from the rising cost of living. Over 80 per cent of homeowners are on fixed rate deals and will be protected from any immediate rise in mortgage repayments following the Bank Rate increase. Those customers who are due to come off their fixed rates later this year are, however, likely to face higher monthly repayments.<\/p>\n

\u201cLenders are prepared to help anyone struggling with their mortgage payments. If you are worried about your finances, do get in touch with your lender early to discuss the options available. They have teams of experienced and understanding advisors who will develop a solution tailored to your individual circumstances. Making a call to your lender to discuss the options available will not impact your credit score.<\/p>\n

\u201cImportantly, the level of homeowners in arrears remains low, meaning that most households are able to keep up with their monthly payments.\u201d<\/p>\n

Nathan Emerson, chief executive for Propertymark,<\/strong> the professional body for property agents, said: \u201cIt\u2019s undisputed that homeowners and first steppers will be facing the consequences of rising interest rates as borrowing costs increase. However, with this comes a further shift towards more realistic and sustainable house prices down from the spike seen during the pandemic.<\/p>\n

“Confidence from sellers is undeterred with our latest data showing a 70% increase in properties available for sale compared to April 2022 and in turn, this is providing buyers more room for negotiation as well as more choice.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

The Bank of England’s decision to increase its base rate to 5% has been labelled a “shock move”, so how are people in the housing industry responding to the interest rate ramp-up? Earlier this week, it was confirmed that inflation in the UK was not falling as expected, sitting at 8.7% in the year to… Read more »<\/a><\/p>\n","protected":false},"author":1069,"featured_media":6087576,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[59,26,6],"tags":[124,107],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6094524"}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/users\/1069"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/comments?post=6094524"}],"version-history":[{"count":5,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6094524\/revisions"}],"predecessor-version":[{"id":6094555,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/posts\/6094524\/revisions\/6094555"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media\/6087576"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/media?parent=6094524"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/categories?post=6094524"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-gb\/wp-json\/wp\/v2\/tags?post=6094524"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}