Andrew Lloyd, Managing Director at property data firm Search Acumen, comments:
“Holding steady amid volatile bond markets is the sensible call. With more housebuilders slipping into pre-tax losses, wage growth subdued, inflation ticking up, and the nation lying in wait in a now-typical pre-Budget hiatus, a rate rise now would have risked a substantial hit to confidence. Threadneedle Street is clearly determined to keep its powder dry for as long as possible, a welcome decision for thousands of homeowners due to remortgage.
“But by signalling that a November increase remains a live possibility thanks to a stuttering economy and yesterday’s inflation data, the Bank of England is giving lenders time to absorb that expectation into pricing rather than springing another shock on the market. This pattern is already taking hold this week: swap rates are being repriced, and mortgage approvals are inevitably declining.
“I think we are going to see this tug of war between debt and growth get much more intense as we approach the Budget. People’s patience is wearing thin with a driving need for certainty, but don’t be fooled: transactions are happening and money is being spent. Property markets are adapting to new ebbs and flows: where flat markets are down, house sales maintain; where hospitality declines, logistics improve; and where international investors take stock, domestic money moves in. It’s clear that when sellers take a price hit, some buyers see opportunity. The UK economy still has underlying strength, and emerging technologies should help us build momentum.
“But access to finance remains key to switching this from a reactive mindset to sustained and deliberate above-the-line investment. Our economy has lacked drive, dynamism, and risk-taking, reflected in our anaemic growth. Many industries are waiting for these catalyst investments to get going. Construction remains the UK’s most financially distressed major industry, accounting for 17% of all UK corporate insolvencies, whilst housebuilder borrowing averaged £6.9bn between January and May 2026, up 6.5 per cent year-on-year.
“Millions of bricks are piling up unused, not because of a lack of will but because unlike larger developers who can ride out higher rates and slower sales, smaller builders face a financing cliff edge that risks shrinking the industry’s capacity just as government housing ambitions require the opposite. If we can get to the end of 2026 without a rise, this would be an undoubted win.
“Looking further ahead, we have already seen that AI can deliver growth, as the figures for June revealed. Allied to some more creative thinking, this should re-energise the UK economy, kickstart growth, and put the economic winds in our sails, rather than being trapped between the devil and the deep blue sea as we are now.”
