Interest rates and a market bounce-back plus a ‘grand design’

BANK of England Governor Andrew Bailey recently said that the UK’s central bank would keep interest rates as high as needed, for as long as needed, to get the level of inflation down.

In a no-holds-barred response to the question of when rates may fall, he said: “Let me be clear, there is absolutely no room for complacency. Inflation is still too high.

"We will keep interest rates high enough for long enough to make sure we get inflation all the way back to the two per cent target.”

That translates as don’t expect too much too soon but for those concerned about the value of their home or being able to buy due to higher interest rates, there is good news from Savills who believe that the property market dip looks set to “bottom out” around the middle of next year.

So, possibly, just another eight months to go before light appears at the end of the tunnel.

Savills residential research team say that interest rates are expected to have peaked and the worst of the house prices falls look to be behind us, though the first cut to interest rates still looks to be some way off, which means affordability pressures are likely to result in further modest house price falls over the first half of 2024.

From 2025 onwards, the only way is up. Read all about this in the feature above and also think on. Excellent advice from my long-serving contacts in estate agency, who have been through many ups and downs with interest rates, is don’t let them stop you moving or buying your first home.

Life is too short. I bought my first home when interest rates were heading up for 15 per cent. I got a cute do’er upper and within a few years I sold it at a profit.

Also this week, we have an award-winning self-build project in the village of Bolsterstone, near Sheffield, that has fantastic views over Yorkshire countryside.