The Bank of England’s decision to hold the base rate at 4% is set to provide some stability but will do little to stimulate the property market, according to industry experts.

The bank’s Monetary Policy Committee (MPC) narrowly voted by a majority of five-to-four to maintain the rate, with the vote coming just a few weeks ahead of the pivotal Autumn Budget. Four members voted to reduce the rate by 0.25 percentage points, to 3.75%.

CPI inflation is judged to have peaked, the MPC said, while progress on underlying disinflation continues, supported by the still restrictive stance of monetary policy. This is reflected in an easing of pay growth and services price inflation, according to the bank.

Andrew Lloyd, managing director at Search Acumen, said: “Stability in borrowing costs is welcome, particularly as the market awaits the chancellor’s Budget later this month, but holding rates steady will do little to reinvigorate activity across the property market in the short term.

“The government is consistently missing its housing targets, where an interest rate cut would have been a major boost to help UK developers reduce borrowing costs, stimulate buyer demand, improve project viability and increase developer confidence.”

Lower financing costs to ease these margins, particularly with smaller housebuilders, could have been a “real win” at a particularly vulnerable time for the sector, Lloyd added.

Looking ahead, for real estate investors, dealmakers and lenders alike, confidence will depend on clear signals from both monetary and fiscal policy. According to Lloyd, the Budget could be that signal, but until then the cautious ‘wait-and-see’ mindset of many market participants is likely to persist.

He said: “If inflation starts to move downwards, we could see further monetary policy easing later this year, which paired with political stability and renewed investor appetite would help unlock a more active property market heading into 2026.”

Kevin Shaw, national sales managing director at property services group LRG, added: “For the property market, today’s decision means continued stability for buyers and sellers. Perhaps on 18 December, when the MPC next meets, with political uncertainty out of the way and inflation data moving in the right direction, we may see a reduction… well timed for Christmas.”