You are reading a single comment by @NickCJ and its replies.
Click here to read the full conversation.
-
Market is pricing in that the BoE will hike a further 100 bps to 4.5% (from 3.5%). Banks are layering in some extra conservatism on top of that / taking advantage of a dislocated market to charge more / don't want to lend at 80% LTV today because it could be 95% in a year's time.
I just find it hard to believe that the Bank will keep hiking through Q2 2023 even as inflationary energy pressures recede and unemployment starts ticking up (reducing worker bargaining power and wage pressures) as the economy crashes.
For a small / low LTV mortgage I would be really tempted to "white knuckle" it for the next 6 months on a tracker. If rates of 6% plus would be existential then fix ASAP.
NickCJ
I understand that, but they don't have to pass it on. And then interest rates are predicted to keep going up, I'm not sure what incentive they have to do so. Maybe if the housing market slows there will be more competition for customers which might make them re-evaluate things?
Edit: I see above some providers have made rate reductions
I'd be really surprised if a rate cut so large as to make a material difference would be possible with inflation running at ten zillion percent. It would take a disaster of some magnitude I think for that to happen.