“Today’s decision to hold interest rates at 4% was widely expected, particularly given recent signs that inflationary pressures are starting to creep back into the economy. After three consecutive cuts earlier this year, the Bank of England has chosen to prioritise stability over stimulus, a move that underlines how finely balanced the outlook is.
“For the property sector, this consistency provides a degree of predictability that has often been missing in recent years, which should help investors and developers plan with more confidence. Yet, the cost of capital remains high enough to keep transaction volumes subdued, and with the Bank signalling that no further cuts are likely this year, it may be 2026 before we see stronger growth momentum returning to the market. Keeping rates the same could disappoint investors and slow recovery in valuations and yields. Investors will likely remain cautious, focusing on income-producing assets and prime properties, while weaker sectors like secondary offices or retail may continue to struggle.
“What is more, the delay of the Autumn Budget coupled with weeks of shifting tax proposals has unsettled both investor and consumer markets. Until the Chancellor brings certainty and greater political clarity, many buyers are likely to adopt the ‘wait and watch’ approach in the face of such a high degree of speculation.
“Looking ahead, those prepared to act decisively once clarity emerges on November 26th will be well-positioned to benefit from any shift in market momentum.”
