For the second time this year, The Bank of England has cut interest rates. The base rate now stands at 4.75% which is the lowest point seen in 2024.
The yearly high stood at 5.25% which was then cut in August to 5%.
What does the mean for home owners?
If you have a property on a tracker mortgage then your payments are likely to change soon. Generally, when the interest rate is cut, monthly mortgage payments become cheaper. There are approximately 600,000 people in the UK who are on a tracker deal who may benefit from this.
First time buyers are also likely to benefit as mortgage repayments may become more affordable than they have been throughout the year.
Those who are on fixed mortgage deals and are coming to the end of theirs will see changes too. But monthly repayments are unlikely to drop to levels which have previously been seen over the last few years.
As an example, if you are coming to the end of a 5 year fixed deal, you are likely to be on a deal of around 2%. The current reported lowest deal is around 3.7% so you will still be paying more than you would have been previously.
If you’re looking to change mortgage deals then now is likely the right time. However, Benwell Daykin estate agents would suggest waiting a couple of weeks to let the dust settle. Many banks or lenders won’t be changing their rates immediately following this news.
Need mortgage advice? Get in touch with our recommended mortgage broker.
If you’re looking to move home since this news then we also offer free property valuations.