Goldman Sachs has thrown a curveball. The investment bank now expects the Bank of England to cut interest rates next week - a full meeting earlier than most economists had forecast. It’s a sharp change in sentiment and, if it happens, could mark a turning point for confidence in the UK property market.
A Shift in Tone from Threadneedle Street
After almost two years of high borrowing costs, inflation appears to be cooling faster than anticipated. Wage growth is easing, consumer spending has softened, and the data now points towards a central bank ready to move from restraint to relief. A cut in November would signal that the Bank of England believes the worst of the inflation fight is behind us - and that it’s time to gently restart the economic engine.
What This Means for Scottish Homeowners and Buyers
For homeowners on variable or tracker mortgages, even a quarter-point cut could bring welcome breathing room. For buyers sitting on the fence, it could reignite affordability and confidence just as the winter market gathers pace.
In Scotland, where demand remains resilient and stock levels tight - particularly in prime areas - a rate cut would likely accelerate competition for quality homes. The market has been poised for momentum; lower borrowing costs could be the catalyst.
Caution Amid the Optimism
It’s worth remembering that a rate cut doesn’t instantly translate into lower mortgage offers. Lenders will move cautiously, assessing how sustainable the policy direction really is. Nor does it resolve the underlying shortage of housing stock that continues to drive regional price resilience. The smartest buyers will use any lull to get mortgage approvals in place early and move decisively when opportunities arise.
Our Take
A surprise rate cut would mark a psychological turning point as much as an economic one. Confidence feeds momentum, and momentum drives markets. For Scotland’s sellers, that could mean renewed competition and stronger offers. For buyers, it’s the signal to prepare - because when the Bank blinks first, the market rarely waits.
