Base Rate Cut Marks Turning Point For Housing Market

August 2024 marked a turning point for the housing market as the Bank of England’s decision to cut the base interest rate accelerated a drop in mortgage rates.

Anticipating the Bank of England’s announcement, many banks had already started lowering their lending rates in July and official confirmation of a base rate drop from 5.25% to 5% has intensified a price war. Coventry Building Society and First Direct have joined Halifax and Barclays to offer a five-year fixed rate below 4%. HSBC, NatWest and Nationwide have all introduced sub-4% products.

Homebuying activity has picked up as purchasers take advantage of better mortgage options. A report by the Royal Institution of Chartered Surveyors (RICS) suggested that expectations of a rise in sales have reached their highest level since the start of 2020.

Halifax has predicted that lower mortgage costs and interest rate cuts could fuel a rise in house prices for the rest of this year. Amanda Bryden, head of mortgages at Halifax, said “Against the backdrop of lower mortgage rates and potential further base rate reductions, we anticipate house prices to continue a modest upward trend throughout the remainder of this year.”

Holly Tomlinson, financial planner at wealth management company Quilter, said: “A feeling that rates are going in the right direction will help many people decide to take the leap back into the market, pushing up demand for homes.”

In an increasingly favourable mortgage market, homebuyers seeking to purchase a home from Erris Homes are in a particularly strong position. We can offer access to low mortgage rates which are exclusively available with new-build homes, including a selection of 3, 4 and 5 bedroom properties at our Calder Mews development in Greetland. We have partnered with new-build mortgage specialist, Evolve Financial Solutions, to unlock a wide range of options, including the Own New scheme which takes a contribution from Erris Homes and uses it with the lender to reduce the rate and lower the customer’s monthly payments. 

To find more about mortgage options available with Erris Homes, please call us on 0113 531 0000 or email caldermews@errishomes.com