How are mortgage and interest rate rises impacting house prices?
There have been a lot of headlines about and mortgage rate rises in the past few weeks.
The Bank of England has now raised the Base Rate 13 times since December 2021. It’s now at 5%, which is the highest it’s been in 15 years. The recent rate increases have been made because inflation has stayed higher than expected.
This has also been, and estate agents are reporting that some home-movers are pausing their plans while they assess what higher costs mean for their budgets.
The increasing affordability challenges of home-buyers has meant that some new home sellers have adjusted their asking price expectations. This is why we’ve seen the average asking price of a home in Great Britain drop this month by 0.2% (-£905) to £371,907. This is slightly below the 0% norm for this time of year, and follows a drop of £82 in June.