What do you think of this news?

[BunnyWilliams]

This article has just popped up on my notifications: https://www.gbnews.com/money/mortgage-storm-budget-painful-interest-rates

What do you think? Scaremongering?

I worry that even if news like this inflated, it's enough to put off FTBs which will slow down the market even more (if that's even possible!).

General forecast is for falls before end of 2024.
Anyway, impacts depend on affordability & I think most people are on fixed.
I'm on tracker coz I can afford small or big rises but expect falls and I wanted option to overpay.

The market is fine round here - northwest

I think as the article says that some Lenders are raising their fixed rate mortgages due to the uncertainty over the upcoming budget.

But I also think that the Bank of England will reduce the base rate again at their next meeting on 7th November - probably by 0.25% - & that will lead some lenders to reduce their rates. And that rates will be reduced further at subsequent Bank of England meetings.

It must be rather unsettling to be someone needing to arrange a mortgage at the moment with all the speculation. Doesn’t help people trying to sell their properties unfortunately.

The BOE no longer determines the price we pay for mortgages.

Some time ago we made the decision to inflate our housing market with a sea of overseas money. The availability/cost of that money is what determines mortgage rates.

All the time international investors that provide that money are asking questions like, Why should we lend money for UK mortgages at X%, when the US government will pay us Y% to hold a 10 year bond (a kind of benchmark for risk) ?

The BOE spends most of it's time setting the rate to play catchup with the markets who determine the price of money.

The forthcoming budget more than anything else will determine what cost the world demands in order to lend us money. BOE rates are a sideshow.

It's GB news trying to stir trouble for Labour as usual.
Yes, mortgage rates have risen a bit but that is because bond yields have risen. This has also happened in the US since their base rate cuts so is definitely not just a UK thing.
UK yields did fall back a bit yesterday with the low CPI figures though.

Overall, as I've said several times on here, I think we are approaching a worldwide recession and that these yields will fall in the short term (12 months or so). That won't make it easier for FTB or other buyers to buy houses though!

@GasPanic is right- the central banks follow the markets.

The market may or may not react badly to Reeves's budget and it may, at some later stage, realise that the UK is far too indebted with no prospect of growth to be a good prospect financially.

I've read that we might see a reduction in the base rate in both November and December now, down to the drop in inflation - which was more than expected due to the cost of petrol. So that's a win for anyone on a tracker.

But fixed mortgages need to take a long term view and there's clearly a lot of change coming our way - who the hell knows what's coming on October 30th.

First time buyers probably shouldn't be hopping on the property ladder if an additional 1 percent throws their figures into chaos anyway.

I read the same thing @ByMerryKoala

I read the markets consider it increasingly likely - time will tell.

It's from GBNews.

Therefore I think it's bullshit.

You think that banks aren't pulling their lowest mortgages from the market - and you think that because it's being reported in gbnews?

I can't get past the paywall anyway but it's not a secret.

It’s not just reported in GB news though.

Mortgages are all about affordability.

It's no good if a fiscally prudent budget comes in that surpresses rates that lead to £100 a month saving on your mortgage, if that budget is achieved by £200 worth of tax rises.

Bank's a hedging their risks. The rates will fall for sure, but with this asset prices inflation is likely to follow and yes, I also believe global recession is coming.