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.

The UK housing market continues to show resilience as data reveals more surprises. Interest rates have been on the rise since December 2021. It was then the Bank of England’s Monetary Policy Committee (MPC) began the first of eleven consecutive meetings in which the standard base interest rate was increased. The rate went from almost zero at 0.1% to 0.25% at the end of 2021 to 4.25% last month. When rates are higher and borrowing more expensive, especially after an extended period of rates being low, the housing market would be expected to slow. However, there is still strong demand in the market as hopeful home buyers refuse to be deterred from their homeownership dreams.

The next meeting of the Bank of England’s Monetary Policy Committee (MPC) is looming and only weeks away. There was not a meeting in April, which gave some relief to those worried about further rate hikes of which there is a strong expectation it could be soon. The MPC has increased the standard base interest rate at each of the last eleven consecutive meetings. Starting in December 2021 when the rate increased from almost zero at 0.1% to 0.25% through to March 2023 when the rate increased to 4.25%. With inflation still in double digits, the MPC could hike the rate for the twelfth time on 11 May.

During the height of the global pandemic and lockdowns an unexpected demand emerged. The lifestyle that was once comfortable and efficient for pre-pandemic living no longer worked. During lockdowns and the switch to working and learning from home there was a need for more space. People were cooking from home so larger kitchens became more attractive. Gyms were closed so there was a need for an area to get fit. Children needed quiet privacy for learning and so did working from home adults. An outside garden area was a plus for families that included children and pets. The high demand for area within and green areas outside was so strong it was dubbed the Race for Space.

There is good news for homeowners considering a remortgage. There have been many new remortgage products put onto the lending market and some have lower interest rates than what was found just weeks before. This is important for the tens of thousands of homeowners that could benefit from securing a fixed rate deal to protect from further rate hikes expected from the Bank of England. Visiting the website of a remortgage broker could quickly offer quotes into a homeowner’s hand to review and compare, including not only newer remortgage offers but possibly exclusive deals lenders do not offer directly to borrowers.