In response to the Bank of England’s decision to cut interest rates to 3.75%, Andrew Lloyd, Managing Director at Search Acumen, comments:
“A cut to 3.75% underlines the Bank of England’s concern about a slowing economy and a softening labour market, particularly after recent data showing back-to-back GDP contraction. This decision will be welcomed across the property market as a further step towards easing pressure on borrowers and restoring confidence after a prolonged period of caution. While inflation remains at watchpoint, the direction of travel is clearly shifting towards supporting growth.
“For buyers, investors and lenders, even modest reductions in borrowing costs can help unlock decisions that have been delayed over the past year. We’re likely to see sentiment improve first, with transaction volumes following more gradually as budgets adjust to better leverage.
“That said, the commercial real estate market is still feeling the impact of Business Rate changes, whilst the prime residential sector absorbs the knock of mansion tax. Markets will still want reassurance that this is the start of a more predictable economic cycle. If rate cuts are sustained into the new year, we could see a more meaningful recovery in property activity as we head into 2026.”
