The Bank of England’s Credit Conditions Survey revealed that the sharpest decline in demand for mortgages since quarter three in 2008 occurred at the end of 2014. While there was less demand for mortgage lending, consumers were confident in pulling out their credit cards to pay for purchases. The report showed the largest increase in demand for credit card lending since 2007.

The housing market increased in 2013 and continued strongly through the middle of 2014. There were fears of a housing market bubble but a natural slowing forecasted by many experts occurred as home buyers walked away from higher asking prices. Currently the housing market shows gradual growth with an expected small boost in the first quarter due to stamp duty changes and current low interest rates offered with mortgage lending deals.

The Bank of England’s Monetary Policy Committee (MPC) is due to gather for their first meeting of the year today. The expectation is that the standard base interest rate will remain at the historical low level of 0.5%. The minutes will be released on January 21 and then the tone of the meeting will be revealed as to how many members voted for an increase to the rate. The current rate has gone unchanged since March 2009.

Home buyers looking to get a mortgage and homeowners looking to remortgage should be aware that despite the Bank holding their rate steady, lenders may soon pull their lowest interest rates. The competitive market that has pushed lenders to lower their interest rates to gain the attention of borrowers could end with weakening of the global economy.