Interest Rate Cut - 09.08.05

UK Mortgage News

Bank of England lowers interest rates by 0.25 per cent.

The Bank of England's predicted cut in the interest rates by 0.25 per cent has implications for borrowers and lenders alike. Many savers with high interest savings accounts such as ING have seen a cut already in their interest rates in preparation for this weeks announcement. Home owners will benefit from interest rate cuts by leading building societies such as the Halifax, who lowered their standard variable rate to 6.5%. The average saving on an £80,000 mortgage is around £12 per month.

The base rate had risen five times last year leaving first time buyers feeling unable to enter the market until the rate stabilised and then showed signs of dropping. Although any drop in interest rates is always good news, the leveling off and in some areas of the UK, dropping down of property prices, has come as welcome news to the FTB's. Some areas of the UK have seen prices rise as little as 0.07 per cent ( in Midlands). Although London prices are always volatile, some areas have seen the prices of flats fall of as much as1.1 per cent.

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