Chancellor Rachel Reeves’ spring statement today produced no surprises – something that was hailed as ‘good news’ for mortgage borrowers.
After the major impact of November’s autumn budget, today’s speech was widely expected to be quiet, with no policy changes.
Instead, the Chancellor explained how inflation had fallen and borrowing had fallen, while living standards and the economy had grown. She said people would be £1,000 better off.
The Chancellor mentioned mortgages in her speech, referring to the six interest rate cuts that had taken place since Labor came to power at the 2024 general election.
These cuts, she said, had saved families £1,300 a year on a new fixed-rate mortgage.
However, she did not make any announcements that would have direct consequences for mortgages, relocations or housing.
Experts say the current lack of real estate or mortgage changes was a good thing, but also a missed opportunity.
Ben Thompson, relocation strategy director at Mortgage Advice Bureau, said: “In the current climate, ‘no surprises’ is actually good news. We weren’t expecting any fireworks from the Spring Statement, and that is reassuring in many ways.
“Right now, the housing market doesn’t need dramatic announcements or last-minute policy changes; the housing market needs stability. So a statement that leaves housing construction largely untouched is itself positive.
“That said, it does feel like a missed opportunity. Major issues like stamp duty reform have still not been addressed, and that continues to hold people back.
“For many families, it’s not the mortgage that’s holding back a move – it’s the hefty additional costs. These expenses can halt plans before they’ve even started, slowing down the entire market and ultimately the broader economy.”
What does this mean for your mortgage interest? Rachel Geddes, director of strategic lenders, also at Mortgage Advice Bureau, said those looking for a mortgage now should speak to a broker.
“An advisor’s job is to filter out the noise, explain what’s really relevant to you and help you choose a mortgage that fits your budget now – and still makes sense for your plans for years to come.”
What is more likely to impact mortgages at this stage is a further escalation of the conflict in the Middle East. Experts are already predicting that last weekend’s events in Iran have raised the swap rates that lenders use to set prices.
Riz Malik, director of R3 Wealth, based in Southend-on-SeaSpeaking to the Newspage Agency, he said we could see similar increases in mortgage prices to the peak in 2022 when Russia invaded Ukraine and Liz Truss launched her disastrous mini-budget.
“Last week, the outlook was promising for the 1.8 million mortgages coming up for renewal in 2026, with inflation even looking likely to reach target,” he said.
“Today it looks like there could be significant volatility in the mortgage market, with the prospects for further cuts disappearing by the second.
“This could be similar to what we saw in 2022, and if you have a mortgage renewal in the next six months, I strongly encourage you to look at your options and not wait.”