Speaking in response to the Bank of England’s decision to increase the base rate from 0.5% to 0.75% our chief executive, David Westgate, comments:
“It was widely expected, certainly by the media and economists, that the Bank of England would decide to increase the base rate from 0.5 % to 0.75 % today. Now that this has been confirmed and given that it had been predicted for some time, it is very unlikely to cause any shock waves in the property market. “We mustn’t forget that rates are still at a record low and have been for 10 Years. Indeed, we should remind ourselves that back in 2008, before the economic dip, the base rate was around 5%!
“What this means, is that in recent times, many people have opted for fixed rate mortgages to take advantage of these historically low rates. Mortgages on floating rates, meanwhile, that would be subject to adjustment after today’s announcement are currently at a record low. Many borrowers are, therefore, protected against any resultant uplift in mortgage costs.
“In terms of property values, irrespective of today’s news, we are already seeing a natural adjustment in pricing across many of our operating areas and this is quite simply because property costs are related to affordability. Confidence continues to underpin the property market and consumers should, therefore, still view a property purchase as a medium to long term investment.”