As expected the Bank of England’s Monetary Policy Committee (MPC) met on Thursday, 17 March, and increased the standard base interest rate. For the third meeting in a row, the rate was hiked and to 0.75%. Considering before the first rate increase occurred in December the standard base interest rate of the Bank was at an all-time, over 300 plus year historic low of almost zero at 0.1% and it is now over seven times that rate, homeowners are encouraged to take notice and prepare for even higher rates and perhaps tightened lending.

Homeowners have shared in surveys that many are confused about remortgaging, the benefits, and for some exactly what a remortgage actually could do to help, especially in economic times when interest rates are on the rise. Increasing interest rates are exactly the forecast throughout the year and into next by experts. Therefore homeowners are encouraged to learn all they can about remortgages and strategize to save money rather than pay more than necessary.

Warnings of interest rate increases have caused a rush to remortgage according to recent reports. In an attempt to escape paying more due to higher interest rates, homeowners have taken action and sought a new deal. According to the Bank of England, there was an increase in the number of remortgages in the last quarter of 2021. The number of homeowners seeking remortgages is expected to grow due to continued threats of rising rates and the tightening on budgets due to increasing inflation.

In December, the historically low interest rate of the Bank of England disappeared, perhaps, and we would actually hope, forever. Very low interest rates are a sign of economic difficulty. The UK economy has been negatively impacted in the last few years with a recession, Brexit, and a global pandemic. The war in Ukraine will now be putting pressure on the economy. The many factors of the pandemic have had an economic impact causing a rise in inflation and while all consumers should beware, homeowners should definitely be taking notice.

The UK housing market keeps revealing resilience is a part of its charm. Just when experts are confident that home buyers are falling out of favor with the thought of buying due to higher prices and higher interest rates the market breaks yet another record. According to Halifax, house prices are increasing at the fastest rate since 2007. The market is so robust that the current average price is the largest annual gain in the almost 40 years of Halifax reports.

The average house price reported by Nationwide for February reached another new high. Records have been broken time after time due to the current housing market. Demand remains high and supply is short. It is heightened due to the expected interest rate increases which will make borrowing more expensive. The new record high average house price reported is £260,230.