With the recent news that inflation has fallen to 2% meeting the bank of England’s targets there was speculation of mortgage rates falling. However, the Bank of England has kept their base rate at 5.25% at their June review.
The next review will on the 1 August where there is still hope for a lower mortgage rate.
Have banks lowered their rates?
HSBC, NatWest and Barclays have all cut the costs of their fixed rate home loans for new deals this year.
NatWest have cut the cost of their fixed-rate by 0.17%.
Barclays has cut their rates by more than 0.25% and announced a series of reductions according to the BBC. For example, this means that a two-year fixed deal that was at 5.13% is now 4.88%
These are small cuts but predictions are set for these to continue in small steps at least until the Bank of England cut their base rate.
Households renewing this year
For those mortgage holders who signed their deals before 2021 when the base rate went up drastically, they could be is for a nasty renewal this year.
The BBC reports that around 400,000 mortgage holders will be having higher mortgages this year. Around one third of Mortgage holder are paying less than 3% on their mortgages, this will changes if they renew this year due to the much higher base rate.
A typical household’s mortgage payments are predicted to raise by 28% which is £180. However, for 400,000 households this could be a 50% rise.
