Surging Inflation Delays Rate Cut Hopes—What It Means for UK Property Buyers

UK inflation has risen to 3.5% in the 12 months to April—higher than expected—prompting fresh concerns for homebuyers, sellers, and the broader housing market. With the Bank of England’s next decision on interest rates just weeks away, the surprise jump in the Consumer Price Index (CPI) has thrown previously optimistic forecasts into doubt.

A Bump in the Road for Mortgage Rate Relief

The Bank of England had been widely expected to start cutting rates in June, but April’s inflation data has unsettled those plans. Property experts and financial leaders warn that the central bank may now take a more cautious approach, potentially delaying relief for mortgage holders.

Daniel Austin, CEO of ASK Partners, says the inflation spike is a reminder of just how fragile the balance is between global uncertainty and domestic economic pressures. "Real relief in borrowing costs is still out of reach for many,” he explains.

Market Uncertainty Leaves Buyers in Limbo

While some sectors—like co-living and build-to-rent—remain attractive to investors, the lack of a clear downward trend in interest rates is keeping buyers on edge.

Simon Webb, Managing Director at LiveMore, noted that many older borrowers are increasingly focused on locking in stable financing. “Despite inflation, we’re continuing to offer competitive rates for the over-50s who need to access property wealth.”

What's Driving the Inflation Rise?

John Phillips, CEO of Just Mortgages and Spicerhaart, points to the April timing: the beginning of the UK’s new fiscal year, which saw energy prices, wages, and water bills rise sharply.

“The Bank expected a temporary inflation bump. But it may still be enough to justify holding rates steady in June.”

Despite this, competition among lenders is still strong, and innovative mortgage products are helping buyers find better deals—especially if they act quickly.

A Delicate Moment for Borrowers and Developers

Nick Hale, CEO at Movera, believes the March stamp duty deadline may have temporarily inflated spending, giving the illusion of stronger economic activity than is sustainable. “We need stability more than anything,” he said, especially with affordability still stretched.

Richard Pike, of Phoebus, echoed this concern. “Regulated price hikes and wage increases are tightening household budgets. Even small delays in rate cuts keep affordability just out of reach.”

Meanwhile, developers like Martyn Smith of Black & White Bridging warn that inconsistent policy signals could jeopardize housing supply. “Even minor sentiment shifts can derail a project,” he says.

There’s Still Reason for Optimism

Ben Thompson, Deputy CEO at Mortgage Advice Bureau, urges buyers not to panic. “Sub-4% mortgage deals are out there, and summer is traditionally a busy season for movers. With the right guidance, now can still be a good time to act.”

Nathan Emerson, CEO of Propertymark, agrees, noting that while the inflation rise is a setback, the property market remains a cornerstone of UK economic growth. “When rates eventually do fall, we expect a surge in housing activity.”

What Should You Do Next?

With over 1.5 million fixed-rate mortgages set to expire this year, many homeowners are facing difficult decisions. Inflation remains stubborn, and rate cuts may not arrive as soon as hoped—but that doesn’t mean you have to pause your plans.

Need Help Navigating Rising Mortgage Rates?

Let Parachute Law guide you through the legal side of buying, selling, or refinancing your property. Our expert solicitors offer fixed fees, personalised support, and clear advice—so you can move forward with confidence, no matter what the economy throws your way.

Get in touch today or call to speak with a property solicitor.

Important Notice

This guide is provided for general information purposes only and is not intended to be relied upon as legal advice. While we’ve taken care to ensure the information is accurate and up to date as of the time of writing, it does not take into account your personal circumstances and should not be used as a substitute for tailored legal advice. Reading this guide does not create a solicitor-client relationship between you and Parachute Law. We accept no liability for any loss or damage arising from reliance on this guide. If you need legal advice about your specific situation, we encourage you to get in touch with us for a confidential consultation. We're here to help you understand your options and take the next step with confidence. Contact us at: thelegalteam@parachutelaw.co.uk