Good news for Nationwide borrowers

homesaver234

"The new Bank of England base rate

The latest Bank of England base rate is: 5.00%.

This is an increase of 0.50%, and was announced by the Bank of England (BoE) on 22 June 2023.

We have reviewed our Base Mortgage Rate (BMR) and Standard Mortgage Rate (SMR) and have decided not to pass on the latest base rate increase at this time."

https://www.nationwide.co.uk/mortgages/bank-of-england-base-rate-changes-and-your-mortgage/

johnhenstock

many will follow, if not already. inflation will literally crash in a few months, so hopefully some good news for those still on a fixed term.

Maka344

johnhenstock said:

many will follow, if not already. inflation will literally crash in a few months, so hopefully some good news for those still on a fixed term.

Let's hope so! Where do you see inflation crashing to?

johnhenstock

over the next 6 months, 3-4%, but it's a wet finger guess. it simply can't stay high for too long, you can't have things both ways. if it stays high for too long, things will go pear shaped -> recession. if there's a recession, rates will plummet again.

I also fundamentally disagree with the idea that very low rates are abnormal, they're compared to a completely different socio-economic era. maybe 5-7% was the normal a few decades back, nowadays it's close to 1-2%.

Clownfish68

johnhenstock said:

over the next 6 months, 3-4%, but it's a wet finger guess. it simply can't stay high for too long, you can't have things both ways. if it stays high for too long, things will go pear shaped -> recession. if there's a recession, rates will plummet again.

I also fundamentally disagree with the idea that very low rates are abnormal, they're compared to a completely different socio-economic era. maybe 5-7% was the normal a few decades back, nowadays it's close to 1-2%.

Agree to an extent. My previous job was in housebuilding and looking at the data. I have been stressing as I took a new job with lower prices become before this started and rates will have an impact. My opinion is genie is out the bottle on property prices due to interest rates being so low for so long have caused property prices to increase to the degree that if you went back to previous rates they are unsustainable in the long term unless wages catch up which they won’t at the level which is needed for People to afford the 5% rates. Once inflation settles I think we will see a return of QE depending on the economic outlook but think 2-3% is we’re it will sit in 2 years time. 

london21

homesaver234 said:

"The new Bank of England base rate

The latest Bank of England base rate is: 5.00%.

This is an increase of 0.50%, and was announced by the Bank of England (BoE) on 22 June 2023.

We have reviewed our Base Mortgage Rate (BMR) and Standard Mortgage Rate (SMR) and have decided not to pass on the latest base rate increase at this time."

https://www.nationwide.co.uk/mortgages/bank-of-england-base-rate-changes-and-your-mortgage/

Is it this?

Still higher than normal 

Current Nationwide Standard and Base Mortgage Rates

We have reviewed our Base Mortgage Rate (BMR) and Standard Mortgage Rate (SMR) and have decided not to pass on the latest base rate increase at this time.

Our rates will remain unchanged at:

• 6.50% for members on the BMR, and
• 7.99% for members on the SMR.

We'll continue to review the position and will let impacted members know if things change in the future.

https://www.nationwide.co.uk/mortgages/existing-mortgage-members/standard-and-base-mortgage-rates/

Newbie_John

johnhenstock said:

over the next 6 months, 3-4%, but it's a wet finger guess. it simply can't stay high for too long, you can't have things both ways. if it stays high for too long, things will go pear shaped -> recession. if there's a recession, rates will plummet again.

I also fundamentally disagree with the idea that very low rates are abnormal, they're compared to a completely different socio-economic era. maybe 5-7% was the normal a few decades back, nowadays it's close to 1-2%.

It's just its nature, if bread cost £1 in 2022, then £1.20 in 2023 (20% bread inflation caused by higher costs of gas, flour, oils..) then if it stays at £1.20 in 2024 (gas, flour, oil prices remained the same) - the inflation would be 0% as it's calculated yearly. 

And the core prices of electricity, flour, oil, gas, fuel started going down.

johnhenstock

So I guess we’re saying the same thing, inflation will come down regardless, even without that clown in the BoE destroying people’s lives.

homesaver234

Still higher than normal 

What's "normal"?