Interest Rate Expected to be Cut for First Time in Seven Years
Due to the historic Brexit vote to exit the EU in the June referendum, the UK could do something it has not done in more than seven years. What has been thought of as an ultra-low interest rate for some time could be in for a decrease. The base rate has been at 0.5% for years and that rate could be cut down for the country to deal with the shock of the vote to leave the EU.
Many experts believe the rate will be cut during the next meeting of the central bank on Thursday. The new rate will be half the current rate and be set at 0.25%. Following the drop in base rate, the bank is expected to reinstate the massive bond buying programme, according to Reuters.
Since the vote on the 23rd of June, interest in buying into the UK housing market has been stifled to levels not seen since the year 2008.
As the pound tumbled in value in the days following the vote, many expected foreign investors to swoop in and purchase property within the capital city. So far, interest in buying London property has not exploded.
Consumer confidence in the market is currently at a low level awaiting the future of the interest rate change among other changes in government.
The remortgage market has slowed drastically since the vote as well. What was once quite a strong segment of the housing market this year, is now falling due to uncertainty and questions from home owners wondering what the market holds next.