Nigel Tennant from Mortgage Advice Bureau in partnership with Barbers comments on the latest Bank of England base rate decision.
A poll conducted by the BBC found that a majority of leading economists no longer envisage a base rate rise until next year. Of the 32 forecasters, who are also regularly polled by the Treasury, 26 predicted that rates would not rise this year, and three predicted there would be no rate increase until 2013.
In light of this no-one was surprised that the Monetary Policy Committee (MPC) voted to retain the bank base rate at 0.5% for the 29th consecutive month.
Although the US Senate finally agreed to raise the debt ceiling and the Eurozone countries recently agreed further bailouts for Greece and a restructuring of debts for Portugal and Ireland, markets still fear that sovereign debt defaults are likely.
Mortgage lenders in the UK continue to offer exceptional mortgage products relative to historic rates with Moneyfacts reporting that 2 and 5 year average fixed rates have fallen further in August having hit all time low levels in July.
Average mortgage rates for 2 and 5 year fixed rates fell back further this month from July falling back by 0.09% and 0.13% respectively and now stand at 4.27% and 5.03%. Average two year tracker rates dropped significantly in August having risen in July and now stand at 3.27% a fall of 0.23% from the previous month.
Lenders have broadly maintained their overall appetite to lend during July with mortgage product numbers averaging approximately 7,250 deals, a slight decrease on June but as we are now in peak holiday season, activity levels do historically level out somewhat during the summer holiday period though.
Product choice and product pricing for borrowers both new and existing remains very healthy relative to the same period last year and significantly improved on this time two years ago.
Nigel is from Mortgage Advice Bureau in partnership with Barbers. For further information on how the latest base rate decision affects you, please call 01952 221200 or email n.tennant@barbers-online.co.uk or click here to visit to Mortgage Advice section of our website.
Your home may be repossessed if you do not keep up repayments on your mortgage.A fee of up to 1% of the mortgage amount may be charged depending on individual circumstances. A typical fee is £95.
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