Rate rise ramifications
Peter Williams is executive director of the Intermediary Mortgage Lenders Association
The latest minutes from the MPC provide a tangible sign that we are moving to the point where a rate rise is firmly on the cards, with two members of the committee laying their hands on the table and calling for an immediate hike of interest rates as a sign of intent.
However, the remainder of the committee is still waiting for the air of uncertainty to clear, suggesting there is not yet enough evidence to justify an early rise, and not least in terms of inflationary pressures.
The Bank has clearly signalled any rises would be modest and gradual.
Recent research from IMLA revealed that one in three brokers expect a rise in rates before the year is out.
But the consensus among lenders seems to be that the first increase is likely to occur during 2015, with nearly half expecting to see a rise in Q1 2015.
When the first rise does take place there will inevitably be some ramifications for the mortgage market.
But the stringent new regulations and stress-tests should ensure that the first rise will not prove to be such an unwieldy burden for borrowers as some had originally envisioned.