A reduction in the Bank of England Base Rate, whilst welcomed, does not have an immediate impact on mortgage holders. Those on fixed-rate mortgages won’t see an immediate change. However, when they come to the end of their fixed-rate deal the ‘rate shock’ may not be as bad as previously feared.
“This is really good news for the market as a whole, though of course savers are less likely to appreciate the fall,” says Edward Mellor Sale Director, Chris Tranter.
“For those looking for a new mortgage, they shouldn’t expect to see a drastically further lowering of rates, as recent SWAP rate changes has already seen a number of lenders reducing their rates, but increased competition will also help to further lower rates.”
“We also expect this welcomed downward trend to continue over the coming months, though more likely to be slow and steady reductions, to ensure underlying inflation remains under control.”
“For people looking to buy, the best time to do so is now, especially if rates continue to fall, this will increase the number of buyers and with still relatively low housing stock, that will lead to an upward pressure on house prices.”
In changing times investors should keep a cool head and a well-diversified portfolio. Asset management groups like Omnis spread your investments across different asset classes, global regions, and styles which can smooth returns and reduce the risks you are exposed to.
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