Musing of a London Property Finder

The Bank of England reduced the official base rate by a further 50 points today taking interest rates to a record low of 0.5%.  Citing projections that Consumer Price Index or CPI Inflation will fall below 2% in the second half of the year, the Monetary Policy Committee also announced a £75 billion programme of asset purchases as an additional measure to ease deflationary pressure. 

The news has been met with joy by borrowers but has been widely criticised by many concerned that the rate cut undermines savers income and exchange rates.  For those in stable employment, there has never been a better time to be a debtor, particularly for mortgagees on variable rate mortgages with no minimum interest rate. Many borrowers are saving in excess of £2,500 a year for each £100,000 of outstanding motgage borrowing.

Fortunately for property search agents like us, interest rate cuts are good news.  Now is a great time to buy as long as you get a reasonable discount off an accurate valuation.  So you see, every cloud has a silver lining.  Instead of investing in boring old gilts – maybe now is the time to think property instead?

London Property Search Agents, Brighton Property Search Agents, offer a nationwide Property Search on application

Technorati Tags: Bank of England Base Rate, Brighton Property Search Agents, Intrest Rates, London Property Search Agents, Monetary Policy Committee, property search agents

Tags: Bank of England Base Rate, Brighton Property Search Agents, Intrest Rates, London Property Search Agents, Monetary Policy Committee, property search agents

Musings of a London Property Search Agent

The latest interest rate cut announced today by the Bank of England (BoE) means great news for homeowners with BoE variable rate tracker mortgages.  Variable rate mortgages based on the Bank of England base rate have been cut drastically in the last 3 months as the Bank of England base rate tumbled from 5% in September 2008 to just 2% from today. 

Mortgage lenders generally take a few months to pass on the rate but as from the early part of next year, many borrowers should see significant savings in their mortgage payments.  The table below provides an idea of the savings on a typical 25 year term BoE base rate tracker mortgage on a capital and interest basis, excluding fees and where the lender passes on the full 3% base rate cut to the borrower.  Not everyone will benefit however, as many mortgages have a collar below which base rate cuts are not passed on.

Clearly the most significant savings are for those on large variable rate mortgages which is great news for our Clients as like many London Property Finders and Relocation Agents working in the mid to top end, a significant proportion of our clients will be saving upwards of £500 a month.

All figures supplied by Piero Mazzoni of The Porchester Group Limited.  You can contact him for mortgage advice on 020 7529 1980 or email him Piero.Mazzoni@porchestergroup.co.uk

http://www.porchestergroup.co.uk/site/home/

This summary is for general information only and is not intended to be advice to any specific person. You are recommended to seek competent professional advice before taking or refraining from taking action on the basis of the contents of this summary. The summary represents our understanding of the law and Bank of England base rates as at 4th December 2008, which are subject to change on a monthly basis. All mortgages are subject to status and to suitable security.  If you are ready to buy contact the London Property Search Agent

Technorati Tags: Bank of England Base Rate, Bank of England Interest Rate Cuts, Interest Rate Cuts, London Property Search Agent, Mortgage Interest, Reduction in Mortgage Repayments

Tags: Bank of England Base Rate, Bank of England Interest Rate Cuts, Interest Rate Cuts, London Property Search Agent, Mortgage Interest, Reduction in Mortgage Repayments