Are Mortgage Rates Coming Down?

Mortgage rates are coming down in the UK.

‍

It is difficult to say for sure whether this will continue going forward. The Bank of England has been raising interest rates in an attempt to control inflation, which has been rising rapidly. However, there are some signs that the housing market is starting to cool,which could lead to mortgage rates coming down. Ultimately, it will depend on a number of factors, including the economic outlook and the Bank of England's future interest rate decisions. We have seen a sharp decline in rates since the premiership of LiZ Truss' government and the mini budget last October 2021.

Here are some factors that could effect mortgage rates in the UK:

* The Bank of England's interest rate decisions: The Bank of England is responsible forsetting interest rates in the UK. If the Bank of England decides to raise interest rates, certain types of mortgage rates will also go up. However, if the Bank of England decides to lower interest rates, mortgage rates will also go down. It is important to note that not all mortgage rates are linked to the Bank of England Base Rate and also poignant to note that even on days the Bank of England raises its interest rate, some mortgage lenders in fact lower their interest rates on certain products.

* The state of the economy: If the economy is doing well, people are more likely to borrow money, which could lead to higher demand for mortgages and this in turn leads to lower mortgage rates as lenders become more competitive. However, if the economy is doing poorly, people are less likely to borrow money, which could lead to lower demand for mortgages and higher or stagnant mortgage rates. Lenders also change their rates in line with keeping their service levels on target.

* The housing market: If the housing market is doing well, house prices will go up, which could lead to higher demand for mortgages and again lower mortgage rates. However, if the housing market is doing poorly, house prices will go down, which could lead to lower demand for mortgages and again higher or stagnant mortgage rates.

* The government's policies: The government can also affect mortgage rates through its policies. For example, the government could introduce a scheme to help first-time buyers, which could lead to higher demand for mortgages and lower mortgage rates.

Ultimately, it is difficult to say for sure which way rates will go over the coming months and years in the UK. The Bank of England's interest rate decisions, the state of the economy, the housing market, and the government's policies are all factors that could affect mortgage rates.