Bank of England holds rates
Ben Thompson, managing director of Legal & General Mortgage Club, said: “January historically is typically a month of apparent inaction by the Bank of England as it pauses for thought whilst considering key sales data and results from recent weeks.
“Regardless of what month in the year this is, Bank Base Rate was not going to change. Inflation is broadly under control and no meaningful further stimulus will be applied to get the economy moving more quickly until it becomes explicitly clear that it is absolutely necessary.
“This may become the case as the year progresses however the picture right now is mixed, and the Bank won’t want to act with new measures unless it has to.”
Thompson said that the mortgage and housing markets have probably hit the bottom – albeit there are regional and even local differences.
He added: “We are starting to see the benefits of the Funding for Lending scheme, and although some question the merits of further cheaper mortgages, for the lucky few this does put more money directly into their pockets and will bring some economic benefit.
“When confidence increases, this combined with historically cheap mortgages should start to bring some much needed cheer the these markets. The recovery will be slow and lengthy, but at least there appears to be a recovery in sight.”