Bank of England’s base rate increase to have “modest impact

One of the UK’s leading mortgage providers, Nationwide, believes that the recent increase in interest rates from 0.25% to 0.5%, announced by the Bank of England following the Monetary Policy Committee’s meeting in early November, will have only a “modest impact” on most UK households because an increasing number of homeowners are now on fixed-rate mortgages.

The Chief Economist at Nationwide, Robert Gardner, believes that the number of homeowners on variable mortgage rates and therefore those most likely to encounter higher payments has fallen to a record low of around 40%; this is a dramatic reduction from 70% seen in 2001.

Robert Gardner went on to add: “Moreover, a 0.25% increase in rates is likely to have a modest impact on most borrowers who are on variable rates.”

By Nationwide’s calculations, given the 0.25% increase in interest rates, the average borrower will see an increase in their monthly payment of just £15 a month to £665 for their mortgage, equivalent to an average annual increase of £180.

Government seeks to make home buying “faster and less stressful

Sajid Javid, the UK’s Communities Secretary, has announced a Government-sponsored, eight-week review of the home buying/selling industry and said that to achieve his aim of streamlining home-buying in England and Wales, he wants to “hear from the industry.” By inviting feedback from mortgage lenders, solicitors and estate agents, he intends to “help save people money and time so they can focus on what matters – finding their dream home.”

This may be a timely intervention, given that there are approximately one million homes bought and sold in England each year. Of these, nearly a quarter of transactions fall through as a result of multiple factors. Of these factors, by far the most contentious practice is that of gazumping. This is where a vendor, having already accepted an offer from one prospective purchaser, then accepts a higher offer from another purchaser.

Mr Javid hopes to be able to instil confidence in the industry by investigating the viability of schemes such as lock-in agreements and speeding up the entire process of home-buying and selling.

Some UK properties remain on the market for over six months

A recent survey by on-line estate agents,, has found that more than 12% of UK properties remain on the market for six months or more. Their survey covered 50 of the UK’s major cities.

There was remarkable disparity in some of their findings. Belfast has the fastest turnover rate with only 1.9% of properties remaining on the market for 6 months or longer, followed by Reading and Northampton at 3.6% and 3% respectively. At the other extreme is Sunderland, with 28.5% of its properties still on the market after six months.

London reported that in the City of Westminster postal district, 22.5% of properties remain unsold after six months.

Share this...

Register details

If you’d like to get email updates from us on relevant property in Bath, as soon as it comes to market, simply
register your details with us.

Once registered, you can also save your favourite properties, making finding them in the future that bit easier.

Bath property updates. iphone

Selling your house?

Complete the fields below for a free market appraisal

Or call Michael Hughes 01225 466 225