Rates Down + Then likely to go higher

The Property Nomads Podcast

Rob discusses the recent decision by the Bank of England to lower the base rate, creating increased competition in the mortgage market. He explores the potential implications of further rate cuts on property investments, suggesting that locking in long-term deals could be beneficial in the face of potential inflation. From a non-property economic perspective, Rob expresses concerns about the impact of decreasing interest rates on inflation and the overall economy.

KEY TAKEAWAYS

• The Bank of England reduced the base rate from 5.25% to 5%, leading to increased competition in the mortgage market.
• With potential future rate cuts, it may be a good time to consider fixing in a long-term mortgage deal to avoid potential inflation and interest rate increases.
• Inflation is expected to reignite due to economic factors, potentially leading to a cycle of rate cuts followed by increases.
• The current economic situation, including social unrest and murmurs of tax increases, may contribute to a challenging environment for the UK economy.
• While the decrease in the Bank of England rate may have negative implications from a non-property economic perspective, it could present an opportunity for property investors to secure favourable mortgage rates before potential future increases.

BEST MOMENTS

"I do like the fact that the headline from the mirror said that it offered a record low rate of three point eight four when you go back to four or five years ago. It's definitely a lot lower than that."

"If rates drop, it might be an idea to then look at locking in long-term deals on your mortgages because the chances are inflation is going to reignite itself and then we're off to the races and then all hell breaks loose."

"Inflation is not going to go away, and with these decisions and with everything else that's going on in the economy at the moment."

"From a non-property economic head, not good news. From a property head point of view, actually, the lowering of interest rates could be a good time, possibly one of the last times where you can lock in an okay rate."

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