Home buyers were given a few more months to hold on to record-low mortgage rates that helped keep the housing market booming during the pandemic, experts said after the Bank of England kept the base rate at 0.1%.

Lenders had revised up their home loans in the past few days on speculation that the interest rate would rise to 0.25% and many of the cheapest deals were withdrawn.

However, while three- and five-year mortgages are no longer offered at rates below 1%, high deposit borrowers still have a wide range of loans at rates below 2%.

Experts said while debt costs remained near record lows, house prices are unlikely to fall. However, activity and growth would slow as the increase reduced borrowers’ disposable income.

“While the best deals may be history by now, the decision not to raise interest rates will give home buyers yet another opportunity to orientate themselves on the low interest rates that have given oxygen to a booming real estate market over the past 16 months,” said Lucian Cook, chief of housing research at real estate firm Savills, said.

“With the incentive of a stamp duty vacation behind us, any increase over the next 12 months is expected to contribute to a slowdown in price growth and activity.”

David Fell, a senior analyst at real estate firm Hamptons, said recent hikes in mortgage costs “are a reminder to buyers that rates are not just moving down”.

He added, however, “For the average first-time buyer, the current upward pressure is likely to mean tens, rather than hundreds, of pounds of additional monthly mortgage payments. I don’t think most people’s purchasing decisions are going to make that much of a difference right now. “

Dominic Agace, the executive director of the Winkworth real estate agency, said speculation about rising interest rates hadn’t affected the mood of prospective buyers.

“The market has naturally cooled since the end of the stamp duty, but with such a low base for mortgage rates and a proposed small rate hike, that hasn’t changed the prospect of buyers,” he said.

Stamp duty holidays across the UK have fueled a market that was already busy when people changed their lifestyles after the pandemic’s initial lockdown.

As the last phase of the UK tax break ended in late September, sales slowed, but recent house price indices showed that price growth has continued.

Nationwide on Wednesday said annual price inflation was 9.9%. Typically at this time of year, the housing market will be quieter in the run-up to the winter months.

Anthony Codling, analyst and chief executive of real estate website Twindig, said he expected the market to be calm for “at least a few months” and that some of the activity next spring may have been driven by the stamp duty incentives.

He said if lenders continue to compete for the mortgage business and keep interest rates low, buyers could be delighted after the winter. While short-term mortgages can remain cheap, the rising cost of living could put pressure on borrowers, which will feed into lenders’ affordability checks.

Increasing a lender’s standard floating rate may also have an impact, as these are typically used to test the finances of new borrowers before arranging mortgages.

Reducing borrowing means they can spend less money on a property, which is not a problem for savers but could reduce the number of buyers who can enter the market with low deposits.

Cook said, “Gradual rate hikes are unlikely to put undue stress on household finances, but they will likely limit the amount of mortgage lenders that advance at the time of purchase, especially if a mandatory affordability stress test is performed.”

Fell said if there was a sharp rise in interest rates it would make a difference to the real estate market.

“Any significant rate hike in the next few years must have the potential to reduce or even reverse price growth due to limited affordability, as well as buy-to-let investors rediscovering the opportunity for higher returns outside of real estate.”