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Market Update: November 2022


The Bank of England Base Rate has jumped to 3%, the highest since 2008. How has that affected mortgages?


If you have been on a variable rate (tracker or discount) you will have seen your mortgage payments climbing over this year. And the latest 0.75% jump might not hit your bank account until December.


If you have just come out of a fixed rate you have probably noticed the available deals bear no resemblance to the rate you have been paying for the last few years.


As the cost of living has increased, so has the cost of your mortgage. However, there is some silver lining to this ominous cloud. The actual cost of mortgage borrowing, for fixed rates via Swap rates has actually reduced. This means that lenders are starting to whittle down their fixes, albeit rather slowly. Around 1 month ago it was common to be offered rate around 6%, but now there are many deals near 5% and under. Naturally, this is still very high compared to where we were a few months ago.


Also, a month ago people were under pressure to secure rates whilst they were shooting upwards. Now, there is more uncertainty and people are waiting to see how far the mortgage rates will fall.


It is predicted that the base rate will rise again https://www.bbc.co.uk/news/business-57764601, but that fixed rates may level out or even keep falling in 2023 https://www.mortgagestrategy.co.uk/news/average-mortgage-cost-forecast-to-fall-in-2023-octane-capital/ .


Examples of current rates :

A First Time Buyer with a 10% deposit should expect to secure a fixed rate from as low as 5.20% up to 5.50%.

A homeowner coming out of their current fixed deal with around 40% equity or more in their property should be able to find fix rates from as low as 4.90%.


Overall, the market is still in a confusing state. For help, contact a broker to guide you to your best solution.

Your home may be repossessed if you do not keep up with your repayments on your mortgage.







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