Bank of England Cuts Interest Rates to 3.75% – What This Means for the Property Market
The Bank of England has cut interest rates to the lowest rate since February 2023- what does that mean for the property market?
The Bank of England has taken a significant step by reducing interest rates, offering a welcome boost to confidence across the housing market. With borrowing costs easing and inflation showing signs of slowing, this latest move could have important implications for buyers and sellers over the months ahead.
Key facts at a glance:
- The Bank of England has cut the base interest rate from 4% to 3.75%
- This is the lowest interest rate since February 2023
- The decision was passed by a narrow 5–4 vote from the Monetary Policy Committee
- Inflation currently stands at 3.2%, still above the Bank’s 2% target
- New data shows inflation has slowed more than expected, helping pave the way for this cut
Growing Confidence Across the Market
Beyond affordability, interest rate cuts play an important role in market confidence. This decision signals that interest rates may have peaked, encouraging more buyers to return to the market and reducing hesitation among movers.
As confidence improves, we often see:
- Increased buyer enquiries
- More viewings and offers
- Stronger competition for well-presented, well-priced homes
What This Means for Buyers
The base rate influences how much it costs to borrow money, including mortgage rates. While lenders don’t always pass on cuts immediately, a move to 3.75% increases the likelihood of more competitive mortgage products becoming available.
For buyers, this could mean:
- Improved affordability and lower monthly repayments
- Increased confidence after a period of uncertainty
- Greater ability to proceed with planned purchases
- Even a modest rate reduction can make a meaningful difference to borrowing power, particularly for first-time buyers.
What This Means for Sellers
Improved affordability and renewed buyer confidence can have a positive impact on demand, particularly for family homes and first-time-buyer properties.
As more buyers re-enter the market, sellers may benefit from:
- Increased interest in their property
- Faster sale times
- More stable pricing in local markets
What This Means for Landlords and Tenants
For landlords, lower interest rates may help ease some of the pressure caused by higher borrowing costs over the past year:
- Buy-to-let mortgage rates may become more competitive over time
- Reduced monthly repayments could improve overall yield and cash flow
- Greater market stability may support long-term investment planning
For tenants, the impact is often more gradual, but still important:
- Improved landlord affordability may help reduce upward pressure on rents
- Increased investor confidence could support rental supply
- A more stable market can mean longer-term security for renters
Thinking of Selling? Now Could Be the Right Time
With interest rates at their lowest level since February 2023 and buyer confidence beginning to return, now could be an ideal moment to understand where your home sits in the current market.
📍 If you’re considering selling, why not book a free, no-obligation valuation?
Knowing your property’s value puts you in a strong position to take advantage of changing market conditions and plan your next move with confidence.
Get in touch with our team today to find out what your home could be worth.
Contact us:
Bebington Branch
0151 644 6000
lesley@lesleyhooks.co.uk
Bromborough Branch
0151 334 5875
rachael@lesleyhooks.co.uk