5.25% BofE Base Rate: What Does It Means For You?
The Bank of England has announced that the base rate will increase by 0.25 basis points, bringing the rate to 5.25%
Mashroom Mortgages spoke with an economist from one of the big four banks in the UK yesterday and their thinking was that the Bank of England base rate will peak at around 5.75%, they then expect the rate to flatline so the Bank of England can see the impact of the measures that they have already taken.
They don’t expect the Bank of England base rate to start to drop until the beginning of 2025, and then – very gradually! – by 2028 they think the base rate will be at around 3.75%. Of course, that was yesterday and in the current market predictions change all of the time!
When looking at mortgage rates these will depend far more on swap rates. We are already seeing some lenders lower rates. These limited edition rates are for relatively small tranches of money, so it is important to work with your advisor to make sure that when one of these rates becomes available they have everything they need to be able to act quickly for you.
With these rates, when it’s gone – it’s gone! They are already proving to be very popular.
Our top tips are:
- Speak to a specialist mortgage advisor as they will not only be able to talk to you about your immediate need, but also your long-term plans for your portfolio, whether this is maximising on what it you already have, disposing of some properties or increasing the size of your portfolio.
- Send the advisor the required documents so that they can be ready to apply as soon as the rate comes up.
- Consider all options; whilst fixed rates have been very popular in recent history, tracker and discounted rates will give you the benefit of any decreases if rates do fall.