UK Inflation Slowing – What does it mean for your UK mortgage?

As a High Net Worth (HNW) client, overseas investor, foreign national, or expat, understanding the implications of inflation and interest rates on your mortgage in the UK is crucial for making informed forward-thinking financial decisions. In this market update, we will explore the significance of inflation and interest rates, their impact on your mortgage, and how Articus Finance can assist you in navigating these factors.

Visit our website to find out more about your UK mortgage options.

1. Understanding Inflation and Interest Rates

According to the Economics Observatory, the rising cost of living has significantly strained household budgets due to price increases surpassing wage growth. However, mortgage holders can also reap benefits from inflation, as it diminishes the value of their outstanding loans, providing them with a favourable advantage. 

Explaining inflation: Inflation refers to the general increase in prices over time, eroding the purchasing power of money – according to BBC.

Unravelling interest rates: Interest rates determine the cost of borrowing money – according to BoE.

The crucial aspect to consider is that mortgage contracts are typically specified in nominal terms, without accounting for inflation. Consequently, higher inflation directly reduces the real value of the outstanding mortgage, benefiting borrowers.

When inflation is at 10%, its impact is significant. For instance, a £200,000 mortgage would decrease in real value by around 10% or £20,000 during 2022. If inflation averages around 6% in 2023, the decrease would amount to approximately £12,000.

 

2. Impact of Inflation and Interest Rates on Mortgages

What does inflation mean for you as an investor?

As an investor, inflation holds significant implications for your financial decisions. Articus strongly advises our clients to consider inflation in every investment strategy. Inflation has the effect of diminishing the real returns on your financial investments and eroding your purchasing power over time.

 

What is the impact of high inflation and rising interest rates for loans with fixed or variable interest rates?

Inflation itself does not directly determine mortgage interest rates.

Instead, central banks – like the Bank of England – establish their policy interest rates based on their evaluation of the overall economic situation, including factors like inflation.

However, the effects of elevated inflation and increasing interest rates on mortgage loans can differ depending on the nature of the interest rate—whether it’s fixed or variable.

Fixed Interest Rates: when an individual agrees with the bank to have a fixed interest rate for a certain period. Even if interest rates go up in the UK market, the client loan’s interest rate stays the same, and the monthly payments won’t increase.

Variable Interest Rates: Rising interest rates directly affect Borrowers with variable-rate mortgages, leading to higher monthly repayments. This could strain household budgets and may result in increased default risk for borrowers who struggle to meet higher payments.

During periods of high inflation and rising interest rates, fixed-rate mortgages offer protection against immediate increases, while variable-rate mortgages expose borrowers to potential payment fluctuations. However, each situation is unique, Articus are available to assist you in making the optimal decision for your investment.

 

Affordability and mortgage repayments

Pay particular attention to the risks of over-indebtedness. 

Given the current high inflation in the UK, Articus advises you to carefully think about the effect of mortgage loan repayment on your monthly and yearly budget. Additionally, you should assess whether there is a requirement to remortgage other properties you may own.

In order to avoid loan repayment issues, get in touch with your broker as soon as possible to explore potential solutions. This could prevent the client from incurring penalties for late payments and facing future restrictions in securing new loans.

 

3. Articus Finance: Assisting Clients in Navigating the Mortgage Landscape

3 steps you can take to deal with the impact of inflation and rising interest rates on your financial investments in the UK

1 –  Pay attention to the real return of your financial investments

When you look at property investment options or think about the risks and rewards of it – it’s important to consider inflation risk. It can affect the actual value and returns of your investment. Remember, inflation risk adds to the usual expenses of investing, like entry and exit fees and transaction costs. Articus provides services to support our clients in order to compare the costs of every financial investment and find the best option possible.

2 – Consider diversifying your investments

Always keep in mind the fundamental principles of investing

  • Keep a well-diversified portfolio.
  • Ensure your investments align with your goals.

By diversifying the types of products in your portfolio, you may generate a high enough return to counter the effects of inflation.

3-  Get advice

Seeking the guidance of a mortgage specialist can lead to better-informed decisions.

If you need more clarification about how inflation might affect your mortgage, Articus is available to discuss it with you. We’ll assess whether updates are necessary for your profile and reevaluate the suitability of your current mortgages.

Expertise in the HNW (High Net Worth) market is crucial to cater to the specific needs of wealthy clients. Articus Finance excels in supporting HNW clients, demonstrating a profound understanding of the distinct challenges faced by this exclusive clientele.

To access additional information, download our HNW guide by clicking here.

At Articus Finance, we proactively manage mortgages for clients seeking specialist finance, such as bridging, development, and commercial solutions. Our goal is to assist these clients in selecting the most suitable mortgage solutions tailored to their unique needs.

Additionally, we explore remortgaging options to ensure that our clients are not only aware of the available alternatives but also have the opportunity to seize better opportunities in the market.

Articus Finance is dedicated to providing tailored solutions for overseas investors and expats seeking to secure mortgages in the UK and worldwide. Our expertise lies in assisting clients from various countries, ensuring a smooth and efficient process. Visit our Countries’ pages to find more. We offer a comprehensive range of services, including expert guidance in navigating complex legal and tax considerations, facilitating currency exchange, and delivering personalized mortgage solutions to suit individual circumstances. With our support, overseas investors and expats can confidently navigate the intricacies of the mortgage market and make sound financial decisions, regardless of their location.

 Articus Overview

Inflation and interest rates significantly influence mortgages for HNW clients, overseas investors, foreign nationals, and expats. Understanding their impact is vital for making informed decisions. Articus Finance offers tailored solutions and expertise to help navigate these complexities, ensuring the best choices for your financial goals. Staying informed and seeking expert advice can lead to effective mortgage management and long-term financial stability in an ever-changing economic environment. Get in touch today.

Proven Expertise

Our specialist mortgage brokers based in London are highly experienced in negotiating the best mortgages and mortgage rates, no matter how complex your situation.

With over 20 years’ combined experience sourcing the best mortgage deals for global clients, our brokers have the skills, knowledge, and lender relationships to turn your property aspirations into a reality. To find out how we do it, explore our case studies.

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a question about our services, we’re on hand to help.

Henry Wong

Mortgage Broker

Henry has amassed over five years of experience in the finance industry, where he has honed his skills in arranging financing facilities for both businesses and individual consumers. At Articus, he leverages his expertise in corporate finance to guide clients in achieving their business objectives, combining a deep understanding of market dynamics with a steadfast commitment to client success. Henry prides himself in problem solving and no deal is too large or complex for him to tackle, he enjoys crafting innovative solutions that drive results. His dedication to his clients is evident in his proactive communication style and his ability to build lasting relationships. Henry holds a degree in Economics from Queen Mary University London and outside of work, he is a creative within the music industry and is an avid fan of Liverpool FC.

Tafouse Raza

Client Services

Tafouse brings expertise from the prime London property market, excelling in client care. Dedicated to exceptional service, Tafouse goes above and beyond to meet your needs. Passionate about rugby, travel, and showjumping, his diverse interests reflect a commitment to excellence in every interaction.

Harry Lart

Mortgage Broker

Harry has over 16 years of experience within the Finance, Housing and Development sector. He started off his career as a CIMA Qualified Chartered Accountant and transitioned over to financial services in 2019. During this time he has dealt with a range of complex financial arrangements from ex pat mortgages to large development loans. Harry has a can do attitude and believes there’s a solution to every situation and will work tirelessly to ensure your deal crosses the line. In his spare time Harry likes to play poker, travel and try new cuisines.

Carolina Barreiros

Marketing Manager

Carolina is a multilingual Marketing Manager originally from Portugal. She specialises in International Marketing and Business, helping organisations expand their brand awareness globally over the last 4 years. Her past work includes supporting start-ups to multinational companies in the UK and across Europe. She is a creative and passionate individual, bringing a fresh perspective to the financial industry and delivering high quality research.

In her spare time, Carolina enjoys socialising & travelling around the world, embracing different cultures and experiences. 

Antonia Grieve

Office Manager

Antonia brings fantastic planning, organisational and time management skills to her role as office manager, ensuring that operations at Articus run smoothly. An experienced administrator with fantastic problem solving skills, Antonia began her career working in medical administration, so she is highly experienced working with confidential client data.

Jack Cuthbert

Client Services Executive

Jack comes from a background of delivering great customer service. He has worked in the property industry since 2016 and has solid knowledge of the property market, combined with a good knowledge of the mortgage industry. Jack is CeMap qualified and enjoys looking after his clients and building strong working relationships. Away from work, Jack spends most of his time travelling with friends, playing football and watching Charlton Athletic.

Matthew Currey

Case Manager

Matthew has experience working as a mortgage administrator and assisting with clients of any calibre. His main strength is his ability to develop a close relationship to his brokers and clients, allowing for a smooth transition throughout your mortgage journey, his friendly nature helps in making the process a lot less intimidating than it needs to be. Outside of work Matthew spends his time playing Chess and exploring the world with his Girlfriend.

Danny Doran

Business Development Manager

Danny started his career in financial services in 2005. He has developed an ability to build relationships and collaborate for success, through consistent communication, a holistic approach to deal building and an ability to swiftly problem solve. Danny has worked with Private and High Net Worth clients for over a decade and is driven by a strong, natural desire to ensure his clients and their businesses reach their full potential. As a property investor himself, he is well placed and experienced in all things property related. Outside of work, Danny has a keen interest in psychology, the outdoors and travelling.

Theo Osborn

Mortgage Broker

Theo started his journey in the specialist finance industry while working as a journalist at an industry trade magazine. During this time he amassed a great knowledge of mortgages, bridging, development and commercial funding and established a wealth of relationships in the industry. He transferred these skills and now specialises in assisting clients with their specialist finance requirements. Working alongside the CEO, Theo has learnt the nuances of ultra-complex transactions and knows how to most efficiently manage the funding process to completion. Theo aims to achieve the best solution for every client he deals with a particular focus on sourcing funding for developments and refurbishment.

Stefanos Petrou

Mortgage Broker

Stefanos started in financial services in 2013 managing clients across central London. Consistently providing a high level of thorough service. Prioritising communication, research, and innovation in order to meet his clients complex goals. Stefanos strengths lie in maintaining long standing relationships and being by his clients side throughout the process. Outside of work Stefanos enjoys spending time with his friends and family, unless of course Arsenal F.C are playing.

Dino Lazarides

Mortgage Broker

With over 20 years of financial services experience Dino is an accomplished mortgage adviser who relishes the more complex cases, enjoys a challenge and always does everything he can to ensure his clients not only get the result they need but to achieve their property goals.   A fully qualified financial adviser Dino quickly realised that property and mortgages were his passion and over the years gained his experience helping investors build their property portfolios.  When not working Dino enjoys spending time with his family, loves modern and classic performance cars, popular culture, technology, mountain biking and is a supporter of West Ham United.

William Gleeson

Mortgage Broker

William started in financial services 2014 arranging finance for HNW clients and their families. One of his main strengths is building deep, long standing relationships with his clients, which enables him to fully understand their needs and tailor solutions to fit each client individually. William has relationships with a variety of lenders ranging from international private banks to some of the largest lenders within the UK. Outside of work, William enjoys spending time with his young family and is an avid rugby player.

Steven Boyde

Mortgage Broker

Steven started working across London’s property and financial services market in 2007. He specialises in development, bridging and commercial finance and has completed many multi-million transactions. Steven believes in customer focused relationships and has many clients who have been with him for years. Away from work, Steven spends most of his time with his two children and wife, on the golf course or watching Plymouth Argyle.

Samuel Asante

Mortgage Broker

Whether you require access to bespoke funding, or need to fund a project of any scale, Samuel will always find a solution to meet the requirements of any client. No matter how complex your case is, through his innovative and determined nature, he can find a structure to finance a client’s plans. As a trained martial artist, Samuel’s passion and confidence carries over into the workplace, and you can expect a clear and concise transaction journey from start to finish.

Jason Hunt

Mortgage Broker

Jason started in 2012 in financial services working across London’s property and financial services markets for HNW individuals. He is able to construct tailor-made solutions to suit his client’s needs, no matter how complicated. He has completed multi-million pound residential, buy to let and commercial developments across the UK. Jason is a confident and motivated individual whom takes pride in offering an exceptional and professional level of service to all of his clients. Outside of work he enjoys hiking, cycling and traveling the world with his sights set on Base Camp Everest.

Assad Younis

Mortgage Broker

Assad prides himself on being open minded and thinking outside the box. Through a personalised approach and consistent communication; Assad’s strong relationships with specialist lenders gives him the ability to reach the ideal outcome for his clients. With a particular strength in dealing with foreign nationals and ex-pats he approaches his clients with a can-do attitude. His attention to detail allows him to actively support his clients and build a long-term relationship by giving a truly tailored approach.  Outside of work, Assad is a keen explorer and foodie, regularly travelling to remote destinations and testing out the local cuisines.

Shyan Zubair

Co-Founder & Managing Director

Shyan is a global businessman with keen commercial acumen and a deep understanding of the UK property market. Following the successful completion of an undergraduate and postgraduate degree in Mathematics from King’s College London, Shyan has held a range of highly strategic roles, with a focus on UK property investment – meaning he is well versed in the world of HNW property finance. Not only is he an experienced UK landlord, he has an impressive history in the world of property trading, and has played a pivotal role in the completion of a number of large scale development projects with values up to £30 million.

Oliver Hines-Lloyd

Co-Founder & CEO

Ollie entered the world of high net worth mortgages after living in Geneva, where he provided tailored financial advice to private clients. This experience shaped his career trajectory, giving him first-hand experience in understanding and communicating the benefits of financial advice – all while developing the ability to build exceptional client relationships. Following this, Ollie moved back to London where he began specialising in mortgages. His drive, ambition and natural flair for anticipating the needs of his clients led him to progress quickly from Client Services to broker, where he honed his skillset after passing his CeMap exams. Outside of work, Ollie is an avid traveller – and an equally keen supporter of his local club, Fulham FC.

Antonio Michael

Co-Founder & CEO

Antonio has over a decade’s experience arranging and negotiating mortgage finance for some of the UK property market’s most complex transactions. During his career, he has worked at some of the UK’s most prestigious mortgage brokerages, as well as the fast-paced world of currency broking. As a result, he has a wealth of relevant experience in handling complicated cases, like clients buying properties through trusts. Crucially, Antonio has developed an almost unparalleled network of close industry relationships. This enables him to navigate challenging situations with ease, and he relishes taking on cases that have struggled to progress elsewhere and seeing them through to completion.

Antonio Michael

Co-Founder & CEO

Antonio started in financial services in 2006, arranging and negotiating mortgage finance for some of the UK property market’s most complex transactions. During his career, he has worked at some of the UK’s most prestigious mortgage brokerages, as well as the fast-paced world of currency broking.

As a result, he has a wealth of relevant experience in handling complicated cases, like clients buying properties through trusts. Crucially, Antonio has developed an almost unparalleled network of close industry relationships. This enables him to navigate challenging situations with ease, and he relishes taking on cases that have struggled to progress elsewhere and seeing them through to completion.