Jackson-Stops comments on rise in interest rates to 4%

Nick Leeming, Chairman of Jackson-Stops, comments on the Bank of England’s rise in interest rates by 0.5 percentage points to 4%.

“The base rate is fast becoming a financial football in which both the government and Bank of England are trying desperately to avoid an own goal.

“Today’s interest rate rise has been widely expected, demonstrating the Bank of England’s commitment to curb inflation and settle wider economic markets.

“The bigger question mark is whether this is the last significant rate rise for some time, enough to put inflation on a downward trend.

“The market will be hoping that rates now sit around this point for the immediate term, or until economic growth picks up, to allow mortgage markets to lean back into growth.

“Jackson-Stops’ national branch data points towards a more balanced market as we move further into 2023. Supply and demand levels are becoming much more closely aligned compared to the market extremes witnessed during the pandemic.

“Our branch data indicates that hotspots like Ipswich, Mid Sussex, Sevenoaks, and Woburn are seeing a steady growth in supply year on year, with consistent levels of viewings and offers agreed, indicating that the appetite for moving home will likely continue and peak again as we edge closer to Spring.

“Market conditions can vary from area to area, with some locations weathering economic headwinds with remarkable ease.

“For those about to remortgage or still trying to get on the ladder, there is no doubt that today’s rate rise will make for uncomfortable reading.

“However, as the lending market settles again in the coming weeks, alongside a growing sense that interest rates might have now peaked, this will allow buyers to plan their house move with greater certainty.

“In recent months the average cost of fixed rate mortgages has been continuing to come down from its peak.

“The ‘Safe Sunak’ effect and distance from the aftermath of September’s mini-budget, has meant that market certainty is a much more likely path ahead.”

Kindly shared by Jackson-Stops

Main photo courtesy of Pixabay