The rate of inflation ticked up a little in December, with rises in tobacco prices due to recently-introduced duty increases. These were partially offset by falling food inflation, where prices still rose but at a much lower rate than this time last year.
Mortgage rates typically follow the Bank of England's base interest rate, and the Bank has increased its rates over the last two years in an attempt to curb rising prices. These high rates have lead to higher mortgage rates on the market. Currently the bank' base rate has sat at 5.25% since September 2023. In the first two weeks of 2024, lenders began to slash mortgage rates as it anticipated another drop in inflation. However, today's unexpected rise may curb lender's enthusiasm to keep cutting, meaning mortgage rates are more likely to remain at the current level. This means housing costs may remain high for the foreseeable future.
[
add
]
[
|
|
...
]