Landlords with mortgages may be sighing with relief as some commentators are forecasting that the Bank of England will not, after all, raise the base rate this week.

It was considered a near certainty that the BoE’s monetary policy committee would agree a rise, because of the growing inflation in the wider economy and to take some steam out of the housing market.

However, despite more high price figures recorded by the latest Halifax index, it now seems many pundits believe an interest rate rise will be put off until New Year. 

The latest Halifax data shows house prices have once again continued to rise over the past month, with November seeing a new average house price record of £272,992. Not only is this a new record price, but on a rolling quarterly basis, growth has reached a fifteen-year high with an uptick of 3.4 per cent.

“At this stage, two months post stamp duty holiday withdrawal, it was hoped we might finally see a downtick in house prices. The still rising prices demonstrates that while the scheme did have an impact on house prices, it was not the only driver. The race for space appears to still be going strong, and when combined with the current demand outweighing supply, prices are still being pushed higher” explains Karen Noye, mortgage expert at wealth management consultancy Quilter.

“Interest rates will be key over the coming months, and an increase would push mortgage rates up which will likely put potential buyers off. However, the new Omicron variant may throw a spanner in the works of any major changes planned by the Bank of England, meaning we are unlikely to see a rate rise yet. While that may be the case, rock bottom mortgage rates are likely to creep up as an interest rate rise is still anticipated, it is just a question of when.

“Those waiting out the housing market boom in hopes of lower prices will likely have to wait a while longer yet. Regardless of whether house prices begin to drop, the likely increase in mortgage rates will contribute further towards the unaffordability of homeownership.”