Following the report from Nationwide revealing there had been slight growth in the average house price in April, Halifax has reported the same with April growth at 0.1% in comparison to the same month last year. It is, however, the lowest rate of growth since December 2021 and it is a decline from the increase reported in March of 1.6%. The average house price declined from March by 0.3% to £286,896. 

This Thursday, 11 May, the Bank of England’s Monetary Policy Committee (MPC) will meet to discuss the economy and determine if further rate hikes will be required to the standard base interest rate. If the majority of members vote for an increase in the rate, it will be the twelfth consecutive meeting with an increase. The base rate will be 4.5% should the rate be increased by 0.25% as it was in March. Economists are forecasting for the rate to increase due to continued strength in the inflation rate which was last reported at 10.1%.

Experts have been concerned for homeowners and their ability to afford their mortgage repayments due to rising interest rates. Their warnings have grown for those coming to the end of their two-year fixed mortgage terms this year due to their need to move to interest rates of today from those offered when rates were historically low. The difference in their repayments could be hundreds of pounds more per month. The best strategy according to experts to make the most of any savings possible would be remortgaging.

The housing market might be in a transitional state according to a recent report. After seven consecutive months of declines in the average house price, April data revealed a slight increase of 0.5%. The data from Nationwide contrasted with the prediction of experts of continued decreases due to higher interest rates as well as remaining high asking prices in the market. The buying boost could be attributed to the rise in demand for flats from first-time buyers or due to the normal increase in buying that occurs in the spring season.

Homeowners are struggling to stretch their financial budgets according to several reports. Not only has inflation long taken a toll as prices have surged upward and remained, but energy costs have put some in the position to have experienced the past winter months choosing between food and heat. However, the reality is that many have yet to experience the next financial stress coming their way when their mortgage terms end.

On May 10, the Bank of England’s Monetary Policy Committee (MPC) will be meeting to discuss the state of the economy, inflation, and whether another increase is needed for the standard base interest rate. Depending on which way the wind blows on a particular day, the expectation is for further rate hikes due to inflation still residing in double digits or for rates to drop due to the strain on household budgets. All will be known in just a few weeks and the outcome either way will have an impact no matter what. For the truth of the matter is homeowners are facing higher rates than they did not long ago.