Property Industry response to latest inflation figures
Matt Smith, Rightmove’s mortgage expert:
“As the rate of inflation stays above 3%, the expectation is that the Bank of England is set to act cautiously. Anticipation had risen that we may be in line for multiple Base Rate cuts this year at the peak of tariff uncertainty, but as some of these pressures have eased, this expectation has fallen back. Forecasts for the rest of the year are likely to jump around a bit due to ongoing global uncertainty and changes in how the market expects things to pan out. However, the current view is that we’re only expecting one more Base Rate cut this year, and tomorrow’s decision by the Bank of England is likely to be a hold.
As for average mortgage rates, these have stayed pretty flat for the last few weeks as the opportunity for lenders to lower rates has reduced. Despite this, we’re seeing an active housing market at the moment, with May having been the strongest full month for agreed property sales since March 2022.”
Nathan Emerson, CEO of Propertymark:
“Although not the drop that many people would have hoped for, especially as we head towards the summer months, which are traditionally the busiest periods of the year for the housing market, we now know that inflation was reported as being 0.1 per cent higher than what was actually the reality for last month, due to a data gathering error.
“All eyes will be on the Bank of England tomorrow as to whether they reduce the base rates further in response to today’s news, and the changing trends of the international economy. A drop in rates would, of course, further help stimulate the housing market, which is a vital engine of economic growth.”
Daniel Austin, CEO and co-founder at ASK Partners:
“Today’s hold in UK inflation offers some reassurance following recent volatility and a continued interest rate hold by the Bank of England. With global uncertainty, fuelled by tariff tensions and ongoing domestic tax changes, still weighing on markets, the key question now is whether the Bank’s rate pause remains sustainable.
“For homeowners and buyers, hopes of lower borrowing costs remain high, but persistently elevated fixed mortgage rates could delay any real relief. While house prices have stalled since the end of the stamp duty holiday, any drop in swap rates, sparked by Trump-related volatility, could revive momentum if it feeds into better affordability.
“Investors and developers are watching closely. Appetite remains strong in resilient sectors like co-living and build-to-rent, where supply constraints keep capital active. But a stable, downward rate trajectory is key. If rate cuts come, it could reignite activity, but with uncertainty still high, staying nimble is essential.”
You May Also Enjoy
Housing Insight Report – April 2025
Thoughts from the Property Industry – National Housing Bank
Planning document will make it easier to ‘green’ new developments
1.8 Million Rental Homes Still Below The Energy Rating 2028 Target, LandlordBuyer Finds
ONS House Price Index – April 2025