Interest rates and its effects on property sector
The Bank of England has raised the interest rate for only the second time in a decade.
The rate has risen by a quarter of a percentage point, from 0.5% to 0.75% – the highest level since March 2009.
While the decision means that the 3.5 million people with variable or tracker mortgages will pay more, the rise will be welcomed by savers.
Five interest rate facts on property mortgage
- More than 3.5 million residential mortgages are on a variable or tracker rate
- The average standard variable rate mortgage is 4.72%
- On a £150,000 variable mortgage, a rise to 0.75% is likely to increase the annual cost by £224
- A Bank rate rise does not guarantee the equivalent increase in interest paid to savers. Half did not move after the last rate rise
- No easy access savings account at a major High Street bank pays interest of more than 0.5