Commenting on the MPC’s decision not to change the Bank Rate from 4.00%, Andrew Gall, Head of Savings and Economics at the Building Societies Association (BSA) said:    

“Many aspiring homebuyers will be disappointed that the MPC has decided to hold the Bank Rate at 4.00% for another month.

“Despite innovative mortgages from building societies to help those with smaller deposits, and recent regulatory changes giving lenders increased flexibility to support borrowers, mortgage affordability remains one of the biggest barriers to homeownership. Our research1 shows that over half of first-time buyers (54%) say the cost of monthly mortgage repayments is an obstacle to becoming a homeowner. Mortgage repayments for new first-time buyers are now around 30%2 higher than in 2020 (22% of income vs 18%). This has led to the dream of homeownership turning into a sense of defeat, with almost one in three (29%) of those wanting to buy a home believing they never will.

“Whilst CPI Inflation remains high at 3.8%, it has not risen as much as feared and the Bank estimate it has peaked. A cut to the Bank Rate just before Christmas is therefore on the cards, although policies announced in the Autumn budget will also factor in the MPC’s next decision.”

1 Property Tracker

2 The Missing Millions

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About the BSA

The Building Societies Association (BSA) represents all 42 UK building societies, as well as 2 mutual – owned banks and 7 credit unions. Building societies and mutual – owned banks have total assets of almost £650 billion. They hold residential mortgages of over £485 billion, 29% of the total outstanding in the UK. They also hold over £485 billion of retail deposits, accounting for 23% of all such deposits in the UK. Building societies and mutual - owned banks account for 47% of all cash ISA balances.

They employ around 52,300 full and part-time staff and operate through approximately 1,300 branches, a 30% share of branches across the UK