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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 28 December 2011

UK Interest Rate: 0.5%

UK Interest Rates Forecast: Rate rise unlikely – further cuts still possible

2012 Mortgage Rate Forecast

The year is ending with a larger number of mortgage products on the market than have been seen since the start of the credit crunch. According to Moneyfacts, not only are there more deals on offer, but there are more deals requiring smaller deposits and average mortgage rates have fallen. So what is in store for 2012?

Mortgage rates look likely to remain low in 2012, but the ongoing Eurozone economic crisis could result in funding difficulties for mortgage lenders – meaning rate rises for homeowners.

On the other hand, competition in the mortgage market looks set to increase in 2012 and with lenders claiming to want to lend more, this should result in better deals for home buyers who need new mortgage deals.

Pressure on household finances and rising unemployment are likely to prevent any substantial increase in transaction volumes in 2012. The Council of Mortgage Lenders is expecting to see a slight fall in housing transactions next year, from 852,000 in 2011 to 825,000 in 2012.

Similarly, the CML is forecasting a slight drop in lending volumes in 2012 – down to £133 billion, from £138 billion in 2011.

Bank of England Rate Forecast For 2012

One thing looks almost certain for 2012, which is that the Bank of England Bank Rate will not rise in 2012.

Indeed, some commentators believe it may even be cut further. The Bank Rate has never been below 0.5% in its history, but technically it could be cut further and we could yet see the Bank Rate as low as 0.25%.

For anyone with a tracker or variable rate mortgage that's tied to the Bank Rate, that would be good news.

 

 

 


 

 

 

 



 

 

 





 

 


 



 


 


 





 


 



 



 

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Please note, this information is NOT necessarily RELEVANT in Scotland


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