The Bank of England held interest rates at 3.75% in its latest announcement, but warned that continued conflict in the Middle East and growing inflation could lead to a rise in borrowing costs.
At its meeting ending on 16 September 2026, the Monetary Policy Committee (MPC) voted by a majority of 6-to-3 to maintain Bank Rate at 3.75%. Three members voted to increase Bank Rate by 0.25 percentage points, to 4%.
Soaring inflation
The announcement pointed to the continuing conflict in the Middle East and its impact on oil / energy prices as a key source of concern. But inflation is also an issue.
UK CPI inflation topped 3.1% in August and looks set to continue to climb in the coming months, with some experts suggesting it could reach 4% by the end of the year.
Those factors could lead to future increases as the Bank attempts to get inflation back under control, with Andrew Bailey, Governor of the Bank of England, saying:
“Financial conditions will continue to work to push down on inflation, and holding Bank Rate is appropriate at this meeting. But if the conflict in the Middle East persists for an extended period, as appears to be the case, and the risk of second-round effects emerging increases, it is likely that policy may have to tighten.”
What does this mean for landlords?
The Bank is stuck between inflation that won’t fall fast enough and an economy they worry can’t handle a hike.
If you’ve got a renewal or a remortgage coming up, it’s worth getting things moving now rather than waiting to see what happens. Most lenders let you lock a rate months ahead and switch down if a cheaper deal appears before completion, so there’s little cost to securing certainty early while the risk is skewed toward rates staying higher for longer.
More than anything though, you should avoid getting caught up in the drama of it all. There will be a lot of headlines in the next few months alongside a healthy dollop of doom and gloom. But rates in the 4-5% range shouldn’t be shocking - they’re much closer to the historical average than the near-zero rates of recent decades.
You can’t control what happens to rates, but you can stress-test your numbers. Before making any decision, run your worst-case scenario - rates rise further, your fix renews higher than you hoped, a void lands at the wrong time. If the deal still works after all of that, then you have your answer. If it doesn’t, then it never really worked to begin with.
There’s always a reason not to act. To hold off and wait until rates drop or the uncertainty passes.
We’ve been doing this for 13 years now. Through Brexit. Through Covid. Through the tax changes, the mini-Budget, and Renters’ Rights reform. Looking back, there have been countless reasons not to buy that looked completely valid at the time. But each one would have stopped you from making money.