Base Rate Cut to 4.75%

The Bank of England has announced a reduction in the base interest rate from 5% to 4.75%, effective November 7, 2024.This decision, marking the second rate cut this year, reflects the easing of inflationary pressures and aims to support economic growth. Here's what this means specifically for the Northern Ireland market.&nbsp;Understanding the ImpactEconomic Growth:The Bank of England’s decision aims to foster economic growth by making borrowing cheaper and stimulating spending. This is crucial for Northern Ireland, where economic growth has been modest. Lower interest rates can encourage investment and consumer spending, contributing to overall economic stability.Housing Market SpecificsNorthern Ireland's property market has shown resilience, with steady demand and relatively affordable prices compared to other UK regions. The rate cut is likely to boost buyer confidence, leading to increased activity in the housing market. Prospective buyers, particularly first-time buyers, may find mortgage deals more accessible, helping to stimulate the property market further.Looking AheadThe base rate cut is a positive signal for Northern Ireland’s housing market and the broader economy. Although mortgage rates will not drop significantly overnight, this move is expected to improve market sentiment and increase activity as we approach the autumn selling season.First-time buyers in Northern Ireland may face ongoing challenges due to high rental costs, but the rate cut could make mortgage financing more accessible. Additionally, policy measures to increase housing supply will be crucial in addressing market pressures.Check in with your mortgage advisor on how this change may affect you.

Bank of England cuts base rate from 5% to 4.75%, the second reduction this year, to support growth amid easing inflation pressures

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NI Housing Market Activity Surge:

The housing market in Northern Ireland has seen a significant boost in activity, with newly agreed sales up&nbsp;18%&nbsp;year on year, surpassing the 10 year average. September 2024 showed&nbsp;2,387 "sale agreed" properties, marking a considerable jump compared to the previous year and reflecting growing confidence in the market.As we progress through Q4, all signs suggest a busy period ahead. For a deeper analysis of these trends, keep an eye out for the upcoming PropertyPal reports, where we provide insights into NI's latest market conditions. Stay tuned.&nbsp;<img src="https://content-dev.propertypal.net/media/sale_agreed_september_00ce906c07/sale_agreed_september_00ce906c07.jpg" alt="sale-agreed-september.jpg" srcset="https://content-dev.propertypal.net/media/thumbnail_sale_agreed_september_00ce906c07/thumbnail_sale_agreed_september_00ce906c07.jpg 222w,https://content-dev.propertypal.net/media/small_sale_agreed_september_00ce906c07/small_sale_agreed_september_00ce906c07.jpg 500w,https://content-dev.propertypal.net/media/medium_sale_agreed_september_00ce906c07/medium_sale_agreed_september_00ce906c07.jpg 750w,https://content-dev.propertypal.net/media/large_sale_agreed_september_00ce906c07/large_sale_agreed_september_00ce906c07.jpg 1000w," sizes="100vw">

Northern Ireland housing market activity is surging, with sales up 18% year on year. Stay tuned for the upcoming PropertyPal Q3 report for more insights.

NI Housing Market Activity Surge: Q4 2024

 How Cost of Living Crisis Affects Home Buyers

The ongoing cost of living crisis is reshaping buyer behaviour across Northern Ireland, with rising costs affecting everything from household budgets to property preferences. As inflation impacts everyday expenses, prospective buyers are reassessing what they can afford. Here’s how the crisis is influencing buyer decisions and shaping the local housing market. &nbsp;Budget Constraints and Affordability Rising living costs are directly impacting how much buyers can afford when looking at properties.<ul><li>Deposit Challenges: Higher costs for essentials are making it harder for many buyers, especially first-time buyers, to save for a deposit.</li><li>Revised Budgets: Buyers are more inclined towards smaller homes or properties in areas that offer better value for money, prioritising affordability over other considerations. &nbsp;</li></ul>Property Preferences: Energy Efficiency Matters With energy bills on the rise, buyers are increasingly prioritising energy efficiency.<ul><li>Energy-Efficient Features: Homes with high Energy Performance Certificate (EPC) ratings, double glazing, and modern heating systems are in demand.</li><li>New Builds vs. Older Homes: There is growing interest in new-build properties due to their higher energy efficiency standards. &nbsp;</li></ul>Location Preferences: Reducing Commuting Costs Commuting costs are pushing many buyers to reconsider location preferences.<ul><li>Proximity to Work: Higher fuel prices mean buyers are prioritising properties closer to their workplaces or with good public transport options.</li><li>Amenities Are Key: Areas with good local amenities and services are increasingly sought after, reducing the need for longer, costly commutes. &nbsp;</li></ul>Buyer Hesitancy and Shifting Demand Economic uncertainty is causing some buyers to delay their home purchase decisions.<ul><li>Increased Caution: Many first-time buyers are adopting a cautious approach, delaying purchases due to financial concerns.</li><li>Exploring Shared Ownership: Buyers are considering alternative options like shared ownership to make homeownership more affordable. &nbsp;</li></ul>Demand for Smaller Properties To manage rising costs, many buyers are focusing on smaller, more manageable properties.<ul><li>Lower Costs: Smaller homes, such as two-bedroom houses, apartments, and compact townhouses, are popular due to their lower energy, maintenance, and council tax costs.</li><li>Downsizing: Many are also looking to downsize to reduce living expenses. &nbsp;</li></ul>Impact on the Market These shifts in buyer preferences are affecting the broader property market.<ul><li>Increased Demand for Affordable Homes: There is a growing demand for more affordable properties, while larger homes are seeing reduced interest.</li><li>Flexible Pricing Needed: Sellers of larger or less energy-efficient homes may need to adjust their pricing expectations to attract buyers.</li></ul> The cost of living crisis is significantly impacting buyer behaviour in Northern Ireland, leading to a focus on affordability, energy efficiency, and convenience. Estate agents need to stay informed of these trends to serve their clients effectively and navigate the evolving market landscape. Buyers are adapting, and by understanding these shifts, estate agents can better support clients in finding the right homes during challenging times.

Discover how the cost of living crisis is impacting home buyers in Northern Ireland, influencing property budgets, preferences, and market behaviour.

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Base Rate Cut to 4.75%
Published 08 Oct 2024

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