What the Bank of England’s interest rate decision means for homeowners

On 6 November 2025, the Bank of England announced that it would hold the base interest rate at 4%. While the rate remains unchanged for now, many experts believe a reduction could be on the horizon, possibly as soon as December. In this blog, we discuss what this may mean for homeowners, buyers, and sellers.

Why did the Bank hold rates?

The Bank of England uses interest rates to help control inflation - the rate at which prices rise. In October, inflation was around 3.8%, down from earlier peaks, but still above the Bank’s target of 2%.

Since inflation is still above target, the Bank decided to wait before cutting rates to see more evidence that prices are stabilising before making any changes. You can read the full summary of the decision in the Bank of England’s Monetary Policy Summary.

What does this mean for mortgage holders?

If you have a variable or tracker mortgage, your monthly payments won’t change just yet. However, if the Bank does cut rates in December, you could see your payments go down.

For those on fixed-rate mortgages, the current rate hold doesn’t affect your existing deal. But it’s worth noting that many lenders are already offering more competitive rates in anticipation of a future cut. If you’re thinking about remortgaging or buying a home, now might be a good time to explore your options.

How does it impact first-time buyers?

Buying your first home can be daunting, especially when interest rates are high. But the recent decision to hold rates along with the possibility of a cut soon could make borrowing a bit more affordable. Lower rates mean lower monthly repayments, which can help make homeownership more accessible.

If you’re a first-time buyer, it’s a good idea to speak with a mortgage adviser. They can help you understand what deals are available and how changes in interest rates might affect your budget.

Is now a smart time to get your property on the market if you’re looking to sell?

If you’re planning to sell your home, interest rates can influence how quickly and easily you find a buyer. When rates are lower, buyers tend to feel more confident and are more likely to make offers.

With a potential rate cut on the horizon, now could be a smart time to prepare your property for sale. That way, you’ll be ready to list when buyer activity picks up.

How will savers and investors be affected if the interest rate is cut?

While lower interest rates are good news for borrowers, they can mean lower returns for savers. If you rely on interest from savings accounts, a rate cut could reduce your income. It’s worth reviewing your savings strategy and speaking to a financial adviser if you’re unsure how best to manage your money in a changing rate environment.

What happens next?

The next interest rate decision is due on 18 December 2025, shortly after the government’s Autumn Budget. The Bank will look at new data on inflation, employment, and economic growth before deciding whether to cut rates.

If inflation continues to fall and the economy remains stable, many analysts expect the Bank to lower rates before the end of the year. You can follow updates directly from the Bank of England and the Office for National Statistics for the latest figures.

At Goodfellows, we understand that interest rate changes can have a real impact on your property decisions. Whether you’re buying or selling, contact us today help you make sense of the market and move you forward in your property journey with confidence.   

The information contained within was correct at the time of publication but is subject to change.

Your home may be repossessed if you do not keep up repayments on your mortgage.