Property market bounce since base rate cut

Other than the usual immediate influx of client messages asking if there is instantly a better mortgage rate available, we havent seen any change in demand in the market since the base rate decision. More disappointingly we have not see any real movements from mortgage lenders repricing their fixed rates downwards despite the vote and comments indicating more likihood of further cuts than originally expected.

Since last Thursday’s base rate cut, it’s been steady, but we’ve seen a lot of activity from homeowners looking to jump onto lower mortgage rates. Many locked in higher rates before the cut & now they’re scrambling to switch—assuming lenders would pass on the rate drop immediately. But that’s where the confusion kicks in. We’ve had to explain that rate changes don’t happen overnight & that banks aren’t exactly rushing to pass on the savings. While lower rates are good news, a lot of buyers are still sitting tight, hoping for stamp duty relief in the Chancellor’s spring statement. If that happens, it could be the game-changer the market needs. Andrew Bailey’s hint at more rate cuts later this year has grabbed attention, but it’s not a done deal. If inflation creeps back up, those cuts could disappear fast. Thursday’s inflation data will be a key indicator of what’s next. For now, it’s a mix of cautious optimism and frustration, as people wait for lenders—and the market—to properly react

The recent base rate reduction has prompted a notable increase in enquiries from existing clients seeking improved rates, though the market response has been measured rather than dramatic. While clients are understandably exploring their options following the Bank of England's decision, lenders have maintained a cautious approach, with little immediate movement in their fixed-rate offerings.
The property market finds itself at an interesting juncture: the Bank of England Governor's indication of potential future rate cuts has introduced a degree of strategic hesitation among prospective buyers, while the persistent gap between property values and wage growth continues to present challenges. Although the rate reduction signals a positive shift in monetary policy, current mortgage rates remain significantly higher than the historical levels many borrowers previously experienced.

We have only just started to see mortgage lenders improve their fixed rates, so it early to see any major changes in borrower behaviour. With around 1.4m borrowers looking for a new deal in 2025 we will see a lot of activity in the remortgage space, with lenders doing their best to attract those looking around now. You can still grab a new deal up to 6 months in advance.