Bank Rate Rise – Bank raises rate to 0.75%

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Breaking News:

The Bank of England has today raised its base rate for only the second time in 10 years, in what appears to be a slow but inexorable trend. The rate has risen by 0.25% to 0.75%. This will be the highest level it’s been since March 2009 – see chart.

The expected increase in May never came as the economy was going through a bit of a dip after the harsh weather in the first quarter. But although inflation appears to be well under control, and wage inflation is still low, The Bank’s Monetary Policy Committee has taken some commentators feels is a bold step.

However, Mark Carney and the MPC now confident enough to raise the rate a notch, concluding that the dip was temporary, one and that economy is growing again, boosted by the good weather over the spring and summer. This view is supported by sustained household spending despite a spate of store closures over the preceding months.

The move will increase the interest costs for anyone with a variable or tracker mortgage, but it will come as a welcome relief and a sign of things to come for those savers who are dependent on income from their investments.

Angus Stewart, Chief Executive of Property Master, said of today’s Bank of England Monetary Policy Committee decision to raise the base rate:

“A rise in base rate has been trailed for quite some time so today’s announcement will not come as a surprise to many.  The economy seems to have recovered its bounce following bad weather earlier on this year and this better economic data has finally forced the hand of the Bank. “

Source: Bank of England

Mr Stewart continued:

“Our recent July Mortgage Tracker which follows rates and fees from 18 of the largest lenders in the buy-to-let market showed that the cost of popular buy-to-let fixed rates deals has continued to fall since the start of the year.

“Five-year fixed rate mortgages have been particularly competitively priced with the monthly cost of borrowing a typical amount of £150,000 falling between £11 and £24 compared to the cost if the loan had been taken out in January.

“Given today’s news of a base rate rise landlords who are looking to borrow to buy a new property or refinance their existing portfolio may need to move very fast indeed if they are going to benefit from some of the good deals we have seen.�

About Property Master

Property Master launched in May 2017 and is the UK’s first and only digital mortgage brokerage service for UK buy-to-let landlords. Its innovative approach enables private landlords to take control of their financing online for the first time by matching their requirements on Property Master’s unique and complete database of mortgage information and lending criteria. Founded by a group of highly experienced financial services professionals, the company is directly authorised and regulated by the Financial Conduct Authority (FCA).

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