Economists predict the base rate may change on August 1 after being held at 5.25 percent for the last year
Homeowners are being warned that 'affordability is still stretched' despite predicting that interest rates could come down today. The Bank of England will reveal on Thursday, August 1 whether the base rate will finally be slashed after remaining at 5.25 percent since August last year.
Robert Gardner, Nationwide's chief economist, commented: "Prices are still around 2.8 percent below the all-time highs recorded in the summer of 2022. Housing market activity has been holding relatively steady in recent months with the number of mortgages approved for house purchase at around 60,000 per month.
He continued: "Investors expect to be lowered modestly in the years ahead, which, if correct, will help to bring down borrowing costs. However, the impact is likely to be fairly modest as the swap rates which underpin fixed-rate mortgage pricing already embody expectations that interest rates will decline in the years ahead.
"The house price crash some predicted simply didn't materialise and, for many, prices are still challenging. A potential base rate cut could inject further energy into the market, with buyers likely becoming more active. Of course, broader economic conditions will also play a role.
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