Director of Fine & Country comments of Bank of England base rate and inflation | Today's Conveyancer

The Bank of England has lowered interest rates from 5.25% to 5%, which is the first time they have done so since the pandemic began in March 2020.

The reduction in interest rates is due to the overall economic conditions being stable and inflation staying at 2% for the past two months. Nathan Emerson, who is the CEO of Propertymark, shared his thoughts on the Bank of England's decision to lower interest rates.

The rate cut announced today is great news for the housing market. It's sure to be a big relief for those who have been struggling with high interest rates for the past couple of years. Summer is typically a busy time for housing, so this rate cut should bring more confidence and make buying more affordable for many people.

With a new administration leading the country and promising to build almost two million new houses, Propertymark is optimistic that today's announcement will be a positive change for homeowners and those looking to purchase a new home.

Iain McKenzie, Chief Executive Officer of The Guild of Property Professionals, remarked: "The mixed signals in the housing market are evident with transactions decreasing one day and prices increasing the next."

It is positive to note that annual growth has increased to 2.1%, but it is worth remembering that prices are still 2.8% lower than the peak levels observed in the summer of 2022.

Everyone is watching closely to see what the Bank of England will decide on interest rates today. They have the ability to shift the financial landscape once more.

Even though there has been a consistent amount of mortgage approvals at around 60,000 per month, this is still lower than the levels seen before the pandemic, indicating a limited interest from buyers. The uncertain economy might also be making some potential buyers hesitant to make any moves in the market.

I believe that the prices of houses will increase slightly in the coming months. If interest rates are lowered, this could also help the numbers go up, but any effects will probably take time to show rather than happening right away.

The Bank of England's choice today will have a big impact on how the housing market looks in the near future.

Nicky Stevenson, who leads Fine & Country, believes that the recent increase in house prices in July could signal a change in the property market. He predicts that if interest rates decrease, there may be a surge in property sales in the second half of 2024.

This is the quickest rate of growth seen since December 2022, indicating a renewed trust in the housing market and potentially the beginning of a more steady time ahead.

This is happening during a period when the overall economy is getting better. Inflation has stayed at the Bank of England's desired rate of 2%, which shows that the steps taken to manage increasing prices are effective.

A decrease in interest rates from the Bank of England has the potential to greatly impact the property market. When interest rates are lower, mortgages become more affordable, and we are already witnessing lenders offering better deals in anticipation of the upcoming decision.

As house prices continue to increase, inflation remains steady, and interest rates potentially drop, we may see a surge in activity in the near future. This could mean more homes being listed for sale and an increase in real estate transactions.

However, even though these factors may contribute to more activity, the complete impact will not be immediate. More houses being available and the ongoing challenges with affordability will work to balance out the situation, making sure that any growth in the market is stable and long-lasting.