The Bank of England has voted to maintain the base interest rate at 4.25%, delivering welcome stability to landlords, developers, and property investors across England. Following May’s modest 0.25 percentage point cut, today’s (20 June) decision keeps borrowing costs steady, providing crucial certainty as the housing market enters its peak season.
While inflation cooled slightly to 3.4% in May, it remains well above the Bank’s long-term 2% target. As a result, six out of nine members of the Monetary Policy Committee voted to hold firm, dashing hopes of consecutive rate reductions. Yet this stability could prove far more valuable to the property sector than knee-jerk monetary moves.
Buyers re-enter the market as fixed rates hold steady
For landlords using leverage, the decision to hold base rates is significant. Average two-year and five-year fixed mortgage rates have barely moved since last month’s reduction, with five-year deals sitting at 5.09% and two-year options at 5.12%, according to Moneyfacts. Fixed products are priced ahead, not reactively, meaning sudden Bank decisions often have limited impact.
Stephanie Daley, Director of Partnerships at Alexander Hall, was upbeat: “Today’s choice to hold the base rate… reinforces the growing sense of consistency and strength in the mortgage market.” She added that product availability remains strong, including “low-deposit mortgages” that are critical for first-time buyers and landlords remortgaging on high-LTV deals.
In practical terms, this pause offers landlords an opportunity to lock in financing or refinance without fear of volatile hikes. With borrowing conditions unlikely to worsen short-term, many investors may now feel confident to expand portfolios or reinvest into refurbishments and EPC upgrades.
Landlord optimism grows despite slower action on cuts
Not all industry voices were satisfied. Guy Murray, Co-Head of Short-Term Finance at West One Loans, argued that the hold “risks stalling the progress we’ve seen in recent months,” especially for developers and landlords managing complex finance packages. “The market doesn’t just need stability, it needs momentum,” he said, adding that further delay could limit growth.
Nonetheless, for most landlords and letting agents, the prospect of a steady rate heading into summer is far from disappointing. “Although today hasn’t delivered any dip, it remains positive to witness overall stability,” said Nathan Emerson, CEO of Propertymark. “As the housing market hits its seasonal busy period, if conditions permit, it would be positive for consumers to have that much-anticipated catalyst of further cuts.”
Buyers have been returning steadily since the beginning of the year, and property professionals across the UK now believe today’s move will sustain that momentum. “Stability is key when it comes to market confidence,” noted Jean Jameson, Chief Sales Officer at Foxtons. “Since interest rates have started trending downwards, we’ve seen robust mortgage approval numbers converting to more offers and more sales.”
Landlords see confidence returning as market steadies
Across the sector, confidence appears to be quietly rebuilding. Jonathan Samuels, CEO of Octane Capital, described the hold as “measured and expected,” adding: “Transaction levels are picking up, mortgage approvals are on the rise, and sentiment among both buyers and investors is improving.”
Even in high-cost regions like London, today’s decision is being seen as constructive. “A hold on rates provides much-needed breathing room,” said Marc von Grundherr, Director of Benham and Reeves. “We’ve seen renewed confidence over recent months… today’s decision will help to maintain that momentum.”
For landlords, this may be the time to act. While interest rates remain historically elevated, the consistency now seen in lending, pricing and approvals could set the tone for a more active, well-balanced property market in the second half of 2025. With inflation easing and confidence tentatively returning, could the next few months mark the start of a new phase for professional landlords ready to invest in stability?
The market’s not roaring ahead, but neither is it retracting—and in uncertain economic times, that’s no bad thing.
