Uncertainty From Homeowners With Interest Rates
According to a report compiled by The Centre for Economics and Business Research (CEBR), 61% of home-owners say they are unsure and confused as to when exactly interest rates will go up. The report suggests that the reason for this uncertainty is a lack of consistent commentary from politicians, experts and regulators. With so much contradictory information and difference in opinion spread across the media, these figures are understandable and come as no surprise.
Many experts have changed tact from suggesting the rate rise would come in 2014, to advising it will come at some point in 2015. The reason for this is possibly the link the original prediction had to inflation, predicted to be 2% in 2014, which in reality dropped to 1%. One leading lender has even moved its rate-rise prediction to the first quarter of 2016, blaming a mix of political uncertainty, weak inflation and a slowdown in the economic recovery.
CEBR themselves predict that any rise in the interest rate will be gradual, with the Bank of England base rate rising to just 0.75% by November. But Howard Archer, chief European economist at IHS Global Insight, said: “It is entirely possible that the Bank of England will hold fire on interest rates until […] early 2016”.
Whatever the prediction, the low interest rate means we are currently seeing some of the best mortgage deals in years, with most customers understandably opting for fixed rate options. The best thing to do, is to take advantage of experts that know your personal situation, as they are able to offer the best advice specific to you and your needs. Now more than ever the advice you gain from intermediaries is extremely valuable, with the media only causing more confusion with their wide range of predictions and sources.