Bank of England base rate announcement: 5 February 2026

The Bank of England has held the base rate at 3.75% in its first interest rate decision of 2026. While the decision was widely expected, many buyers, sellers and homeowners are understandably asking what it means for the property market — and whether now is a good time to make a move.

Here’s a clear breakdown of today’s announcement and how it could affect you.

What happened with interest rates today?

The Bank of England’s Monetary Policy Committee voted to keep the base rate unchanged at 3.75%. Five members voted to hold rates, while four supported a further cut.

That close split suggests that although no change was made today, future reductions are still very much on the table if economic conditions continue to shift.

Why did the base rate stay the same?

Inflation rose unexpectedly to 3.4% in December, which has made the Bank more cautious in the short term. While rates have already been cut four times over the past year, the Bank is keen to avoid moving too quickly and risking inflation rising again.

The Bank also revised down its forecast for UK economic growth in 2026, now expecting growth of 0.9% rather than 1.2%. Slower growth often leads to a “wait and see” approach when it comes to interest rates.

What does this mean for the housing market?

Holding the base rate steady helps maintain stability in the housing market. There’s no sudden change that would push buyers or sellers to act immediately, but recent rate cuts are still having a gradual effect on confidence.

Lower borrowing costs over the past few months have already made mortgages more affordable for some buyers, and that support remains in place. While today’s decision won’t trigger a surge in activity, it helps keep conditions predictable – which is often what the market needs most.

In Chester, where demand remains steady and stock levels are balanced, this period of stability may suit buyers and sellers who prefer certainty over volatility.

How does this affect your mortgage?

If you’re on a fixed-rate mortgage

Nothing changes for now. Your rate stays the same until your current deal ends.

If you’re on a tracker or standard variable rate

Your payments may have fallen slightly after the December rate cut, and today’s decision means they should remain at that level for the time being.

If your fixed rate is ending soon

This could be a good time to review your options. With the base rate lower than it was a year ago, some more competitive fixed-rate deals are becoming available.

Speaking with a whole-of-market mortgage advisor can help you understand what’s available and whether switching now makes sense.

Could the base rate change again later in 2026?

Possibly. The Bank has indicated that if inflation continues to ease and economic growth remains subdued, there may be scope for further rate cuts later this year. However, for now, the approach is cautious.

We’ll continue to monitor future announcements and what they mean for the local property market.