According to Trading Economics, a well-known economic analysis, data and forecasting organization used by professionals all over the world, the Bank of England benchmark rate is expected to be 4.5% by the end of 2022 (up from 0.1% a year earlier) and 6.25% by the end of 2023.
Assuming that by the end of Q3 2022 Trading Economics was expecting a rate of 2.75% and actually the BoE raised only to 2.25%, we could probably calibrate the forecast and allow for a 0.5% less BoE rate by the end of 2023 as compared to the forecast. Still, the forecast may be met and exceeded considering the recent UK government budget which shook the financial markets and BoE comments that it plans to limit the flow of credit to the economy.
Considering the property prices are at a historical peak, even minor changes in the interest rates significantly affect the mortgage payments. An increase of the BoE rate by another 3-4% in our opinion will put material pressure on the property market and weigh on the prices significantly.
