Commenting on the MPC’s decision not to change the Bank Rate from 5.25%, Andrew Gall, Head of Savings and Economics at the BSA, said:
“With the latest inflation figures showing a fall, and today’s decision not to increase the Bank Rate, many consumers will no doubt start to feel that there is finally a light appearing at the end of the tunnel.
“This week is UK Savings Week, and for those with savings, the sharp increases in the Bank Rate over the last 18 months means higher rates are available to them. There’s a wide choice of savings accounts on offer, which vary depending on the provider, term and access required, with attractive rates available for all levels of savers. Shopping around can now make a sizeable, financial difference, both for existing savings and those who are just starting a regular savings habit.
“Mortgage borrowers are likely to breathe a collective sigh of relief that the Bank Rate is unchanged, after 14 consecutive rises. However, for first-time buyers the higher cost of a mortgage compared to two years ago, alongside the increased prices for energy, food and other items, will have a considerable impact on what they can borrow. They may need to lower their ambitions about the property they would like to buy as they are unlikely to be able to borrow at the level they might have achieved before the Bank Rate started to rise in December 2021.
“For existing homeowners, our recent Property Tracker Report showed that the vast majority (87%) are not worried about keeping up with their mortgage payments. Lenders, however, remain conscious that there are a number of families and individuals for whom meeting their mortgage payments is a real worry. They are ready and well equipped to offer practical, tailored support to anyone who may be struggling and would encourage anyone with concerns to contact them as soon as possible, preferably before they miss any payments.”
You can find out more about UK Savings Week here
The BSA represents all 42 building societies, as well as 7 of the larger credit unions. Building societies serve around 26 million consumers across the UK and have total assets of over £500 billion. Together with their subsidiaries, they have helped over 3.6 million families and individuals to buy a home with mortgages totalling over £370 billion, representing 23% of total mortgage balances outstanding in the UK. They are also helping over 23 million people build their financial resilience, holding over £362 billion of retail savings, accounting for 19% of all cash savings in the UK. Within this, societies account for 41% of all cash ISA balances.
With all of their headquarters outside London, building societies employ around 51,500 full and part-time staff. In addition to digital services they operate through approximately 1,300 branches, holding a rising share of financial services branches in local communities.