The Bank of England’s Monetary Policy Committee (MPC) has voted to increase the standard base interest rate during the last five consecutive meetings. The last time, which was during the June meeting, there was a 0.25% increase. This brought the base rate to 1.25% which is the highest the rate has been since 2009. There were three members that would have liked the rate to have been moved to 1.50%.

The outlook on the housing market is very different than it was this time last year. The standard base rate of the Bank of England was at an all-time 300 plus year low of 0.1%. Home buyers were showing strong demand even though asking prices were breaking records month after month. Despite the higher asking prices associated with properties for sale, the cost of borrowing was so cheap it kept home buyers interested and motivated. 

The UK house prices have month after month surprised experts. They did so during the pandemic and are still doing so despite high inflation and rising interest rates. However, despite house prices increasing to another record high in June, it is expected that buyers will begin to leave the market later in the year. Rightmove reported asking prices rose for the fifth consecutive month in June. The 0.3% increase put the average asking price at £368,614. 

The Bank of England’s Monetary Policy Committee (MPC) met today and as expected they hiked the standard base interest rate. The rate was moved by 0.25% to 1.25% and is now the highest it has been in 13 years. The interest rate hike comes during a time when household budgets are already at a strain. Many were still in recovery mode from the pandemic and lockdowns. Inflation and higher costs of fuel and energy are also a concern, and for some the rate hike will cause financial difficulties.

Homeowners are being warned to take a look at the details of their current mortgage. For those that have little equity in their property, it could be time to set a strategy in place. The Bank of England’s Monetary Policy Committee (MPC) will be meeting this week to determine if another rate hike is necessary. Experts believe it is definitely possible, especially due to the high rate of inflation, and because there is not a scheduled meeting for July. At a minimum, there is an expected increase of 0.25%, but it could be more.

The next meeting of the Bank of England’s Monetary Policy Committee (MPC) is days away. There is much discussion among experts and others about the outcome of the meeting. There are very few that believe the meeting will conclude without a hike to the standard base interest rate. Most do believe there will be a higher rate, but how much higher is still up for debate. Some believe that the MPC should be more aggressive and perhaps increases from here on out will be much higher than the slow and steady 0.25% increases seen so far.