Buy in London at 6.17% or wait for rates to fall?

[jade_details]

The rate saving from waiting could be swallowed by a more competitive purchase. If lower borrowing costs bring buyers back while London supply stays tight, the £838,500 property may not become cheaper overall.

I can afford the quoted 6.17% payment, but that does not settle the decision. Buying fixes the purchase price, while the later rate, refinancing options and timing of any sale remain uncertain. I want to stress-test a higher reset and a situation where remortgaging offers little benefit or is unavailable.

I am also comparing the cost over the likely holding period, including arrangement fees, early-repayment charges and portability. What assumptions would you use for that downside test without relying on a prediction that rates or prices will move in the helpful direction?

 

[EvenGate]

I wouldn’t base it on whether rates fall. Compare the cost over the period you realistically expect to hold the mortgage, including arrangement fees, rather than looking only at 6.17%. Then test whether the monthly payment still works after a higher rate reset, and whether you could cope if refinancing were unattractive or unavailable.

What are the loan-to-value and fixed-rate period? Those affect your refinance assumptions. Also check early-repayment charges and portability if resale is a genuine possibility. Lower rates may lift competition, but that outcome isn’t guaranteed.