Bank of England Cuts Interest Rates to 4.5%

The Bank of England has cut interest rates for the third time in just under a year, bringing the rate down to 4.5%. The move, supported by the majority of the Monetary Policy Committee, is aimed at boosting economic growth amid easing inflation, which currently sits at 2.5%. However, concerns remain that rising energy costs and other pressures could push inflation higher later this year. This is the lowest base rate since June 2023. The Bank of England has also adjusted its growth forecast, now expecting the UK economy to grow by 0.75% in 2025, down from an earlier prediction of 1.5%. The rate cut could lead to lower borrowing costs for some homeowners and businesses, but the impact will vary depending on individual financial arrangements. As lenders respond to the change, borrowers and savers alike will be watching to see how it affects their finances.

The Bank of England has lowered its key interest rate by 0.25 percentage points to 4.5%, marking its first cut in months.

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Stamp Duty Changes in 2025

The start of a new year often brings changes to property taxes, and 2025 is no exception. The government’s recent adjustments to stamp duty have sparked interest and questions among buyers and sellers across Northern Ireland. Whether you’re a first-time buyer, a homeowner considering a move, or an investor looking to expand your portfolio, these changes could have a significant impact on your next property transaction. Here’s a breakdown of what’s changed and how it might affect you. &nbsp;What are the New Stamp Duty Changes and do First Time Buyers Have to Pay It? Stamp Duty Land Tax (SDLT) is a tax paid to the government when property is purchased. There are various rates, exemptions and reliefs, but one common myth is that first time buyers don’t have to pay it. In fact, first time buyers DO pay SDLT – but how much depends on the purchase price of the property. As of 1st April 2025, if a first time buyer purchases a property up to the value of £300,000, SDLT is charged at 0% and therefore no SDLT will be payable (good news!) If a first time buyer is purchasing above £300,000 however, the portion of the purchase price that exceeds £300,000 will be charged at 5% of the purchase price (stick with us for an example)… SO - if a first time buyer is purchasing a property at £350,000, the first £300,000 is charged at 0% and the remaining £50,000 is charged at 5%. &nbsp;Therefore, the SDLT payable on that purchase would be £2,500. Defining a ‘first time buyer’ Speak with your solicitor as early as possible about the definition of a first time buyer – it isn’t as straightforward as you might think, particularly if you’re buying a property in joint names and the person you’re buying with has owned property in the past. Important note re: UK resident status To avail of the SDLT relief threshold, the purchaser must be a UK resident. If they are not defined as a UK resident by the Government and HMRC, the portion of the purchase price up to £300,000 is charged at 2% and the portion above the £300,000 is charged at 7%. To take the example above of a First Time Buyer purchasing at £350,000 with the purchaser being a non UK Resident, the SDLT payable would be £9,500. Again, just speak with your solicitor early on to find out if this might affect you. Millar McCall Wylie’s residential team can answer any queries you might have about SDLT at any point in your property journey – whether you’re setting out your budget or have found your dream home. Buying a property is a huge step and having all the information you need just makes sense.<hr>Try Our Legal Fees Calculator To help you plan for these changes, PropertyPal in partnership with Millar McCall Wylie offers a legal fee calculator to determine the costs involved in buying and/or selling a home.

Discover how the 2025 stamp duty changes impact buyers & sellers in Northern Ireland. Learn key thresholds, benefits & expert tips today.

NI Housing Market:

It’s that time of year again when the crystal ball comes out and economists and analysts look ahead to what lies in store. While 2024 began with caution and concern, what materialised won’t look too bad in the history books. Average property prices reached £221k, up 6%, and typical rents now sit at £900 per month, rising 8.7% over the year.Encouragingly, the sales market is showing fresh signs of optimism, with new stock listed for sale up 8% year-on-year. However, the rental sector remains challenging, with listing volumes still well below long-term averages.On the leading indicator front, all signs point to a strong start for Q1 2025:<ul><li>Website visitors are up 20%.</li><li>Engaged Audience search time has increased 3%.</li><li>Enquiries to agents have risen 6%.</li><li>Agreed sales volumes are up 14% in the last three months, signalling a healthy pipeline of completions into the new year.</li></ul>The Outlook for 2025Overall, the year ahead looks more positive. Demand is improving, supported by a robust local labour market and a stable—potentially improving—interest rate environment. This should form the basis for relative stability, with modest price growth in the 3-5% and transaction levels forecast at around 25,000, in line with long-term averages.4 Key Themes to Watch<ul><li>Interest Rates &amp; Lender Competition: Mortgage rates are expected to soften gradually. Intense lender competition, particularly for re-mortgage business, will present opportunities, even if average rates remain modest.</li><li>Housing Supply: Sales stock has improved, but rental listings remain weak, and housebuilding is still below long-term averages. The recently published Housing Supply Strategy will be critical to addressing supply issues across all tenures.</li><li>Buyer Trends: First-time buyers remain the market’s largest group. While some softening in mortgage rates will help, affordability constraints may keep budgets in check.</li><li>Stamp Duty Changes: The revision to Stamp Duty Land Tax (SDLT) for Northern Ireland and England from April 2025 will likely have a limited local impact but could distort wider UK market trends, with potential knock-on effects here. &nbsp;</li></ul>In summary, the Northern Ireland housing market heads into 2025 with renewed momentum. Demand remains strong, sales activity is improving, and economic conditions are stabilising. While supply challenges persist, the outlook is for modest growth, increased buyer opportunities, and a market that continues to improve.<hr>To learn more about the Northern Ireland housing markets, visit our housing market reports for more insights.

Explore the Northern Ireland housing market outlook for Q1 2025, including trends in house prices, interest rates, and rental demand.

Bank of England Cuts Interest Rates to 4.5%

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