James Bawa, CEO at PEXA UK

“The continuing rise in interest rates is taking mortgage payments with them. Another rise in interest rates is likely to result in a significant proportion of borrowers rushing to lock in existing deals in case rates climb further. 

“Higher interest rates might mean that we see a fall in the number of property transactions overall, but it might spur action from homeowners looking to manage their finances more closely.

“A rising interest rate environment will continue to encourage borrowers to shop around, as customers who took out a two-year fixed rate mortgage during the stamp duty holiday in 2021 will see their deal come to an end this year.

"To help the mortgage market cope with growing remortgage demand, and position it to capitalise when transactional activity bounces back, technological innovation is needed.

"Digital remortgages are going to be key in transforming the property market, helping to increase capacity, reduce friction and improve customer experiences in a market where interest rates continue to rise.”

Jonathan Gordon, director at IP Global

"This increase in the base rate, while expected, is likely to put a further squeeze on the already overheated UK rental market.

“The shortage of affordable housing stock is widely documented. However, it looks like savers who are waiting for a fall in borrowing rates before they purchase are likely to defer their decision for longer.

“In the short term, this is likely to add further pressure to rents as the supply and demand imbalance continues.

“Landlords are also likely to increase rents to mitigate the impact of higher borrowing costs. It's a blow for tenants as much as it is for many borrowers."

Adam Oldfield, chief revenue officer at Phoebus Software

“The will they, won’t they of the past few days has now been settled and for most it’s not the decision they were hoping for.

“There is the suggestion that the rise in inflation last month was a temporary blip, and we should start to see the numbers coming down again soon.

“If this is the case, it’s hard to see that the Bank of England will have any cause to put the base rate up again in its next meeting.

“We were just starting to see the housing market moving again, so the news of another increase could well give people further pause for thought.

“The only light is that we’ve seen lenders reducing rates in the last week, so perhaps they may not be as quick to put rates up if current swap rates are baked in.

“Nevertheless, for those on SVRs or trackers it’s a worrying time and lenders, will be getting their houses in order to ensure exposed borrowers get the support they need.”

Jatin Ondhia, CEO at Shojin

“Today’s interest rate decision was on a knife-edge. The stakes were so high with elevated tensions across the US and European banking systems and yesterday’s shock rise in inflation — this all undoubtedly turned the heat up on the Bank of England, and it is telling that it opted to stick to its tough line of hiking interest rates to curb the cost of living crisis.

“Those hoping for a respite from tighter monetary policy may have a longer wait ahead than anticipated, as policymakers grapple with the dual task of confronting inflation and easing bank jitters.

“As such, in the current climate, investors must stay focused on their individual goals, assess the risk exposure they are comfortable with, and ensure they are using all the tools and techniques at their disposal to protect their wealth against uncertainty and changing market conditions. If they do, they could find new opportunities amid all the turbulence. From diversification to tax efficiency, agility will be the watchword as the foggy conditions persist.”

Andrew Gething, managing director at MorganAsh

“The news of a surprise jump in inflation last month was clearly enough of an excuse for the Bank of England to make another increase. Without this, the expectation was the MPC would look to hold rates, signalling that this may well be the last for a while.

“This will be of little comfort though to the more than 1.6 million households on either tracker or variable mortgages. Thanks to today’s decision, they will once again see an almost immediate impact on their monthly mortgage payments, which is on top of a rise in other outgoings, mainly food costs.

“At all levels across financial services, it’s once again a reminder that firms must be alive to challenges facing those vulnerable customers who will be most susceptible to harm — after all, the upcoming Consumer Duty regulation brings with it the obligation to not only identify, but monitor the vulnerable characteristics of all customers throughout the lifetime of the product.”

John Philips, operations director at Just Mortgages

“This latest 0.25 percentage point rise may feel like a step in the wrong direction for the mortgage market, but it’s widely accepted to be a necessary step in the battle to curb inflation.

“Although the base rate has gone up, we have seen mortgage prices falling in recent months and customer enquires to our brokers across the country have been remarkably robust since the start of the year.

“The advantage of yet another rate rise is that nobody should be caught off-guard and I think that brokers are doing a tremendous job in managing the expectations of clients and finding them the right deal."

Tomer Aboody, director at MT Finance

“Following the unwelcome news that inflation has risen again, it was inevitable that interest rates would have to follow suit in order to try to get the former under control.

“While the government's target of halving inflation by the end of the year might now look slightly optimistic, many believe that the right course of action is being adopted in the background.

“There are concerns that further rate rises could result in further issues for the banks, but let's hope there is enough stability to counter that risk and that this rise is the penultimate, if not the last, before the bank can start reducing base rate.”