Adam Oldfield, chief revenue officer at Phoebus, says:
“In amongst the news of rising interest rates and high inflation we find an increase in the number of remortgage approvals in April. This is as expected with so many people coming off fixed rate deals this year. However, with the ‘effective’ interest rate paid now standing at 4.46%, the option of fixing for a further two or five years is unlikely to be something borrowers will be willing to do. Perhaps that might change this month with many predictions saying the Bank of England is likely to raise rates again and by as much as one per cent.
“Lenders are caught between a rock and a hard place, increasing base rates inevitably mean mortgage rates will creep up but that puts pressure on existing borrowers’ affordability. This places more borrowers in a vulnerable position when the burden from the rising cost of living is at the highest level we have known for a very long time. Although there appear to be many properties coming to market, the prospect of a larger than expected rate rise later this month could dent confidence, which in turn might mean we see house prices start to fall.”