Mortgage rates, the Autumn Budget and a Sigh of Relief for Homebuyers

Posted by Foxtons New Homes on 29th November 2022 -

The atmosphere is quite different after the Autumn Budget than it was after the Mini Budget in September, which is great news for mortgage rates, which had just begun to fall. For those of us selling and buying London homes, this drop in rates is some much-needed great news.

The media have had an uncomfortable message to share on the house market lately, with mortgage rates and cost of living on the rise. That’s why our partner mortgage broker, Alexander Hall, were thrilled to share some excellent news about mortgage rates; they have officially begun to fall as the dust settles post-Mini Budget.

The Office for Budget Responsibility has confirmed that, after hitting a 40-year high of 11.1% (which was projected higher), Consumer Price Index Inflation will begin to fall next year. In the November report, OBR stated, “On a calendar-year basis, CPI inflation falls back from 9.1 per cent in 2022 to 7.4 per cent in 2023.” This should benefit affordability for buyers. We’ve waited to see the Autumn Budget before sharing, and although the base rate has risen (and is forecasted to continue to), mortgage rates will likely decline further. “We’ve seen over 20 lenders reducing rates before the budget announcement,” Stephanie Daley, Director of Partnerships at Alexander Hall, told us, “And since, we have seen further lenders reprice downwards, and a 2nd rounds of rate reductions in a short time frame from the High Street providers.”

The best way to take advantage of falling rates, and account for uncertainty in the market, is still to speak with a mortgage advisor. You shouldn’t have to be an expert with your finger on the pulse to buy or sell a home. That’s why Alexander Hall are following up their Q3 activity, with incredible 26% rise in volumes of mortgages being processed, with an unseasonably busy Q4, so far.

Stephanie said, “People are asking for an opinion on where the market stands right now, about the potential to finance early, whether to fix their rate, whether they should wait to buy or what they can do to make their purchase manageable.”

If you’re having trouble finding the right mortgage in this climate or in your situation, talk to an advisor. Alexander Hall have cultivated a vast network of lenders – from the biggest names to the small, local lenders. They know which lenders are strict on affordability, which are more flexible, which are open to different types of income, etc. Strong relationships with key providers allow them to find the best possible deal for your specific situation and keep an eye on the moving market for you.