"Maintaining base rate at 4% will fail to restore confidence in a market that has been rocked by rumours of proposed property taxes"
- Oliver Prior - Auction House
The Monetary Policy Committee (MPC) has decided to hold the base rate at 4%, marking the latest disappointment for the property sector, according to Auction House.
On 18th September, the MPC broadcast their decision to keep the rate unchanged. While inflation has remained above the 2% target, the outcome was not entirely unexpected. However, it has dampened hopes for renewed activity in the property market.
The current pause follows five reductions since August 2024, with the latest cut on 7th August 2025. Despite these decreases, affordability for buyers has not improved, contributing to falling average house prices and a stagnating market.
“This has been the story of the year, with sticky inflation holding back market activity,” commented Oliver Prior, national commercial director of Auction House (pictured). “This is a consequence of the government’s fiscal agenda, which has led to flatlining growth and, over the last five years, a reduction in property values.”
He added, “Maintaining base rate at 4% will fail to restore confidence in a market that has been rocked by rumours of proposed property taxes. The reality of these taxes will not be revealed until the Autumn Budget, which means that property buyers and sellers will operate in a market filled with uncertainty until late November. This will continue to inhibit activity, particularly in London and the South East, which will be most affected by any tax rule changes.”
Given the current inflation environment, it is now possible that no further base rate cuts will occur this year.
Despite these challenges, the auction segment of the property market has shown resilience. Auction House recently celebrated a record-breaking summer for its weekly national online auction. In August, the company hosted its largest ever weekly event, raising a total of £10,811,201 across four events — a notable achievement during a period that typically sees slower activity.
“Property auctions are excelling while other routes to sale stall,” said Oliver Prior. “This is because auctions provide two crucial things in an uncertain market: speed and security. The short timeline between exchange of contracts and completion, which is typically 28 days, gives both buyers and sellers much-needed reassurance. As we enter an unpredictable autumn, these advantages will continue to appeal to those looking for speed, transparency and simplicity.”
