The June figures show a fall from 8.7% to 7.9% which was more than expected, experts were forecasting a figure of 8.2%.
This is good news for borrowers as it takes the pressure off the Bank of England to increase the base rate as much as they may have done.
What does this mean for the mortgage market?
This is a step in the right direction, although it doesn’t mean we are going to see a big impact on mortgage rates immediately, we are already seeing movements downwards in the markets lenders secure their rates from. If inflation is starting a general downward trend then hopefully things will ease over the coming weeks and months.
How can we help?
As independent Brokers we have real time access to rates as they change, so if you just want a quick conversation about what your mortgage may look like in the future or you’ve been putting off moving then we will be happy to help you make an informed decision.
The Bank of England have been raising interest rates to curb inflation, the logic is that people will spend less and save more when prices are high, when this happens prices tend to come down, but remember just because inflation comes down it doesn’t mean prices are. Anything over zero means that prices are rising.
Core inflation, excludes the more volatile figures around food and fuel prices, has fallen from 7.1% to 6.9%. Having said this the expectation is The Bank of England will increase the Base Rate again in August.
The fall in inflation in June may slow down the BoE’s raising of the base rate with many experts predicting it will rise to 6% in August (next decision due August 3rd, 2023), the same experts are now suggesting it may only rise by 0.25% instead.
The first step is a conversation with one of our experts.
If you’d like to learn more about mortgage products and how we can help you, please don’t hesitate to get in touch with our team. We’re here to help you navigate the ever-evolving world of mortgages and guide you toward a brighter, greener home.