Bank of England holds Base Rate at 3.75%: Takeaways for advisers and landlords

With no change to the Bank Base Rate again, our Chief Commercial Officer, Steve Cox, explains what this means for advisers and their landlord clients.

“On balance, holding BBR at 3.75% feels like the right decision, although yesterday’s inflation figures underline just how much pressure is now building on the MPC. CPI has risen for a second consecutive month, from 2.9% to 3.1%, and with higher oil and gas prices continuing to feed through as the conflict involving Iran and the US persists, the risks clearly remain to the upside. However, increasing BBR would do very little to address inflation being generated by global energy prices, while it would immediately increase costs for borrowers on tracker and variable-rate mortgages. The MPC has therefore chosen to hold its position for now, but if inflation and energy costs continue moving in this direction, the pressure to act is likely to become overwhelming.

“For the buy-to-let mortgage market, today’s hold certainly should not be interpreted as meaning product rates will stand still, because lenders have already had to respond to higher swap rates and funding costs over recent weeks. Mortgage pricing has effectively been moving ahead of the MPC, although the need for some lenders to build business volumes during the remainder of 2026 could provide some counterweight to those funding pressures. For landlords approaching a refinance there is clearly a need to act, but purchasing landlords should also think carefully about simply waiting for rates to improve, because there is no guarantee they will. Exploring what is available now, and working with an adviser to understand those options, appears far more sensible than trying to predict exactly where pricing might be several months from now.”