In response to the Bank of England Interest Rate published today which held at 3.75%, Nick Leeming, Chairman of Jackson-Stops, comments:
"The Bank of England’s decision to hold interest rates provides a welcome sense of stability for the housing market, offering reassurance after a sustained period of elevated borrowing costs following the inflation shock.
"This is not a comfortable pause. The Bank continues to be pulled in two directions, with inflation proving sticky while growth and household demand show signs of softening. That balance is keeping policymakers cautious about signalling any imminent policy easing.
"For the housing market, the implication is that borrowing conditions are likely to remain elevated for longer than many had anticipated earlier in the year. While mortgage pricing has already adjusted to a more stable rate environment, expectations for meaningful near-term relief in borrowing costs are likely to remain constrained.
"That said, the market is continuing to adapt to these conditions rather than being constrained by them. Buyers remain active, albeit more selective and price-sensitive, with a clear focus on long-term value. At the same time, we are seeing an uptick in instructions in key commuter hubs and lifestyle markets, when property is priced accurately, it is selling.
"Looking ahead, the balance the Bank strikes between persistent inflation and moderating growth will determine the direction of travel for interest rates over the remainder of the year. Overall, while activity remains measured, underlying market resilience continues to provide a platform for stability and gradual confidence to build as conditions evolve."
