Bank of England holds base rate: what it means for property borrowers

The Monetary Policy Committee held the base rate at 4.00% for a third consecutive meeting. For property borrowers the headline matters far less than what has happened underneath it: five-year swaps have drifted four basis points lower and lenders have begun competing on margin rather than waiting for the next cut.

That competition is uneven. Clearing banks have been slow to reprice commercial term debt, while challenger lenders and private credit funds have moved quickly on development senior and stretched senior facilities. We are seeing senior development debt priced from 7.45% where twelve months ago the same scheme would have been quoted north of 8%.

For anyone holding a bridge, the practical consequence is that the term exit is now easier to evidence than it was in 2025. Where an exit was previously assumed, lenders will now underwrite it — which shortens the whole chain and makes a twelve-month bridge with a development exit a considerably less nervous proposition.

Our advice to clients on facilities maturing in the next nine months is unchanged: start the refinance conversation six months out, and treat the covenant package as the negotiation rather than the rate.