23 Aug NICK’S CORNER: MORTGAGE RATES
Will the latest interest rate increase affect the North Somerset property market?
With the Bank of England increasing the base rate by 0.5% in the past few weeks, the largest increase in 27 years there is plenty of speculation as to what will happen to the housing market. Despite 0.25% increases every month since November 2021 the North Somerset housing market has remained active, and prices have continued to rise and it is certainly far from grinding to a halt.
The past two years have seen unprecedented demand for property with the number of people looking being, on average 34% higher than pre-pandemic levels. There are still plenty of headwinds to battle against, but despite all this, it is worth noting that there are plenty of reasons to remain optimistic. Nationwide’s latest house price index shows a 12th consecutive month of house price growth, we have a strong labour market with unemployment at a near 50-year low and job vacancies are close to record highs whilst there remains a backlog of buyers – plenty of those retaining the desire to move, possibly before rates increase further or because they need that extra space for homeworking; combined it is expected that this will also see house prices remain stable. One final thought is that the majority of homeowners have a mortgage and the majority of those mortgages are on long-term fixed rate deals so they are not affected by interest rate rises and will be able to move those mortgages to another property.
Whatever you want to do it is worth remembering there is plenty of free advice available from very good professional sources who can help you make an informed choice that is best for you. If you have any questions or want any guidance then feel free to get in touch by messaging us, calling 01275 877771 or emailing [email protected] and as always we love to hear your thoughts, opinions and stories.
Thanks for reading.
Nick