Can Jeremy Hunt’s astonishing u-turn slow down the mortgage crisis?

by Adrian Anderson, Director of property finance specialists, Anderson Harris.

“After a complete reversal of the Trussonomics experiment, the new Chancellor, Jeremy Hunt, will be hoping his strategy will restore confidence, calm the markets and persuade the Bank of England to slow down the speed of interest rate rises.

Mortgage borrowers will be desperately hoping that a reversal to the proposed tax cuts can help take the edge off inflation and hence slow down some of the pressure we are seeing on both fixed and variable mortgage rates.

The average 2-year fixed rate has been rocketing since the mini budget was announced. The average 2-year fixed rate was circa 4.74% on the day of the mini budget and is now circa 6.47%. We currently have a scenario where some borrowers will be unable to pay their mortgage.

This u-turn may provide us with some temporary respite but I suspect the economic rollercoaster isn’t over yet with the brewing political chaos and uncertainty around Liz Truss’ leadership.”