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UK Interest Rates Forecasts and Predictions for Home and Property in the UK

Checkout this weeks latest interest rate forecast here

 

Interest Rate Update 14 December 2011

UK Interest Rate: 0.5%

UK Interest Rates Forecast: Rate rise possibility in 2012

Governor Issues Warning As UK Bank Rate Remains 0.5%

The Bank of England Bank Rate has remained at 0.5% - a record low level which has been unchanged since March 2009.

However, Mervyn King, the Governor of the Bank of England has warned homeowners that the Eurozone crisis means banks are experiencing an increase in wholesale borrowing costs. These rises are likely to be passed on to UK homeowners at some point, resulting in rising mortgage rates.

A number of mortgage lenders have already increased their rates over the last couple of weeks. At this stage, rates on individual deals are being adjusted – rather than blanket rises being applied to all mortgage deals – but this situation could worsen.

Fixed-rate and tracker mortgage deals are directly dependent on the cost of borrowing money on the wholesale markets. This can be illustrated by the Libor rate, a rate charged to banks for borrowing money from each other. The three month Libor rate is currently more than 1% - up from a low of 0.83% in the summer.

Mortgage Approvals Up In November

Despite these warnings, rising mortgage rates have yet to seriously bite and many homeowners are currently able to enjoy the best mortgage rates since the economic crisis began in late 2007.

Mortgage approvals rose by 4% from October to November and were 15% higher than in November 2010. Having a big deposit still counts, though - according to e.surv chartered surveyors, the average deposit was 38% in November, down from 40% in October.

 

 


 

 

 

 



 

 

 





 

 


 



 


 


 





 


 



 



 

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Please note, this information is NOT necessarily RELEVANT in Scotland


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