There was good news for those looking to secure a mortgage deal today as the Bank of England’s monetary policy committee reduced interest rates by 0.25% to 4%.

It is the second cut this year and the third in 12 months and leaves rates at their lowest point since June 2023.

Although the decision won’t be welcomed by savers, it is better news for anyone looking to buy a property as lenders look to lower their rates.

For those with tracker mortgages the impact will be an immediate, with a reduction in monthly payments.

For those with looking to re-mortgage or who are on variable rate deals, they can expect lenders to cut their rates in line with the Bank. 

Sheldon Bosley Knight’s associate director, Andrew James said: “In the short term, interest rate cuts generally lead to reduced mortgage rates.

“Consequently, homebuyers can secure loans at lower costs, potentially increasing the affordability of buying a home.

“This increased affordability often results in higher demand for property, as more individuals can enter the housing market.

“With increased demand, house prices may also rise as buyers compete for available properties. For sellers, this trend might lead to quicker sales and higher offers.

“Additionally, rate cuts might spur refinancing activities as existing homeowners seek to reduce their mortgage payments by locking in lower rates.

“This refinancing boom can lead to a flurry of activity in the housing market in the months following the announcements of rate cuts.”