Week 27 - 2025 Market Analysis Snapshot by FOBEA: Gold Glitters, Yields Growl, and House Prices Get the Jitters.

Ben Johnson
Jul 1
7 min read

Updated: 2 days ago

A lot has happened since the last market review hasn't it? WW3 wobbles aside, let's see where we're up to and what all this means for UK property Investors:

TL;DR: Rates frozen, yields rising, gold glittering - keep your chequebook in the freezer.

Disclaimer: This article is educational in nature with satirical comments. Nothing in this article is financial advice. Do you own research - trading and investing is risky and you may lose your investment. Sources are quoted at the bottom of the article. All views expressed are that of the author and not of FOBEA as a whole or its Partners.

FOBEA Weekly Snapshot banner for Week 27, featuring a blue-toned analyst, a weary cartoon gentleman clutching a “Bond Market” placard, and a winking brown bear set against a red-and-green candlestick chart. — *"Tell that to the bond market"*

Welcome to Week 27 2025 Market Analysis:

Turn up the heat, then throw on an ice-pack, that was the vibe this week. Gold punched through $3,350/oz as traders fled a dollar that suddenly looked wobbly, while long-dated Treasuries spiked to 4.9 % and dragged gilts higher for the ride.

"Tell that to the bond market" - Camel Finance (YouTube) circa 2025. 🐪

Risk assets lost their foothold: the S&P 500 surrendered almost 3% in five sessions, crypto’s spring bloom wilted (sell in May and go away anyone?) and UK builders watched mortgage approvals stall faster than you can say “affordability stress”. Yet the Bank of England kept Bank Rate glued at 4.25%, mumbling about “data dependence” as CPI remains politely at 2.6%.

For UK property punters the message is mixed. Yes, sterling’s slide and bullion’s gleam normally tempt foreign cash into prime London, but rising real yields and a 0.8 % monthly drop in Nationwide’s house-price index hint the leverage party is still over. Add in stubborn arrears and a 46% US and 40% UK recession probability for April 2026 and you have a recipe for caution seasoned with bouts of FOMO. "So what you're saying is sell BTC at the top and buy a 2-bed in Canary Wharf with the profits?" No. 🤷

With that, let’s drill into the numbers that shaped the week.

#1: Market Analysis Snapshot - WC 30/06/25

Indicator (units)	Latest reading	1-wk trend	Why investors care
Bank Rate (%)	4.25	→	Drives UK mortgage pricing and tracker resets.
UK CPI YoY (%)	2.6	→	Sets the inflation backdrop for wages and rents.
US M2 (USD tn)	21.94	→	Proxy for global liquidity; spill-over into risk assets.
Fed funds range (%)	4.25–5.50	⇧	Anchors dollar funding and carries through to sterling swaps.
S&P 500 (pts)	6 025	⇩	Global risk barometer; wealth effect for cross-border buyers.
Crypto market cap (USD tn)	3.10	⇩	Windfall gains often seed speculative buy-to-lets.
FTSE 350 Household Goods & Home Construction (pts)	11 480	⇧	Read-through on UK builder confidence and DIY spending.
DJ US Home Construction (pts)	16 754	⇩	Signals direction of global building-material costs.
UK mortgage arrears (%)	1.30	→	Early warning for forced sales and distressed supply.
US 30-year Treasury (%)	4.87	⇧	Long-bond yield drives global discount rates.
GB 10-year gilt (%)	4.49	⇧	Sets the risk-free hurdle for UK commercial property yields.
Gold price (USD/oz)	3 380	⇧	Classic fear gauge; rallies often precede safe-haven real-asset bids.
Recession probability US (%)	46	→	US slowdowns dent London’s financial-services jobs and bonuses.
Recession probability UK (%)	40	⇩	Higher odds cap price expectations and lending appetite.

#2: What This Signals for UK Property Investors

Bank Rate: Still Stuck at 4.25%

The Monetary Policy Committee again opted for stasis. With core inflation easing and wage growth plateauing, swap markets now price the first cut in November. That delays any meaningful relief for variable-rate borrowers and keeps five-year fixes anchored near 4%. For investors, carry on stress-testing deals at today’s rates - the cavalry is still over the hill. In other words 🤨

The BoE is the bartender who promised to water down your drink but keeps forgetting; you’re left nursing the same overpriced pint while the band packs up. Every announcement day feels like déjà vu on draft. At this rate the only thing dropping faster than policy rates is your patience (and perhaps the head on that neglected pint). In the corner you hallucinate Mr. Powell stroking his purple tie whilst maintaining eye-contact with the bartender and nodding manically like the Jack Nicholson gif

We like high interest rates don't we? DON'T WE?!

CPI: Cooling, Not Cooled

Headline CPI clings to 2.6%, but services inflation remains north of 4%. Build-cost inputs have rolled over, yet labour shortages keep fit-out quotes spicy. Rent growth is finally outpacing CPI, offering landlords a small real-yield cushion.

In other words 🤨

Prices have “stabilised”- if you ignore the decorator charging Gucci rates for Dulux and a ham sandwich that now costs more than your first iPhone and the cheeky surcharge your electrician adds for “inflationary vibes”. *PLUG ALERT - FOBEA never add maintenance surcharges - the contractors do enough of that" 🤡 It’s the economic equivalent of a diet where you skip dessert but double-up on fries. Landlords cheer that rents are outrunning CPI, yet tenants just see an ever-shrinking slice of pay packet disappearing into someone else’s mortgage... It's brutal really...

Long Yields: The 4 Handle Club

A 10 bp pop in the US 30-year to 4.87% and a matching move in gilts to 4.49% lifted real yields and re-priced discount models. Cap-rate pressure is creeping back into valuation memos, especially for secondary offices. Expect buyers to demand another 25-50 bp yield premium by summer’s end.

In other words 🤨

When the so-called risk-free line heads north, your glossy brochure’s IRR scurries south – faster than you can mumble “DCF sensitivity” into a valuation committee Zoom call. That pristine artist’s impression of a rooftop garden turns into a spreadsheet footnote reading “margin compression”. Soon the only thing green about that ESG-certified office block will be the faces of investors staring at their down-round appraisal.

S&P 500 Fall-back

The index’s 180-point slide looks modest after a record quarter, but sentiment matters: risk-off spells fewer US bonuses, thinner expat demand and less punch in global wealth. UK residential deals above £5 m already feel the chill.

In other words 🤨

Wall Street sneezed and every London estate agent reached for a silk monogrammed hanky, muttering “there goes my Marbella deposit, ” while frantically revising next quarter’s Porsche upgrade to a gently used Prius. A 3% dip may look like a paper cut in New York, but on this side of the pond it feels like a guillotine hovering over bonus season. Cue sudden enthusiasm for “motivated seller” listings and champagne flutes being discreetly replaced with supermarket prosecco.

Gold Glitters at $3,380

Bullion tore through its previous high as traders fretted over twin-deficit America and skidding Chinese growth. Historically, a sustained gold rally precedes heightened demand for trophy London flats from capital-flight buyers.

In other words 🤨

Those with swollen ISAs and 401s are panic-buying yellow rocks again (and not I don't mean the digital kind) - which means Knightsbridge kitchen-diner conversions are next on the shopping list. Goldbugs insist bullion is “tradable insurance”; estate agents call it “fiat-flavoured fuel” for prime-London bidding wars. Either way, expect more anonymous LLCs parking capital where the council tax is optional but the marble splash-backs are mandatory.

Crypto Market Cap Swings

A $240bn evaporation wipes out plenty of would-be crypto-bro deposits. Agents in Manchester’s Digbeth-meets-Dubai towers report a sudden uptick in “financing fell through” calls.

In other words 🤨

When your buyer’s ape-coin moonshot turns into a smoking crater, expect the reservation cheque to bounce higher than Doge on launch day and twice as meme-worthy. Developers who boasted about accepting crypto deposits now find themselves issuing polite “payment reminder” emails in plain old sterling. Somewhere, a freshly minted NFT landlord is googling “can I pay completion funds in exposure bucks?” (polite reminder this is all satire)😹

"Alt Season is right around the corner. When it comes, I'll be buying a property with the gains!" Meanwhile, the corner:

Market Analysis - a roundabout gif meme about the alt coin season — Alt season is just around the corner

UK Recession Risk Eases... slightly

Bloomberg’s probability edge-lowered to 40 % as services PMI clings above 50 and April GDP surprised on the upside. That soft-landing narrative keeps mainstream lenders open, but underwriting remains forensic.

In other words 🤨

The economy is “probably fine” - like a Jenga tower two blocks from catastrophe but technically still standing, while officials insist the wobble is “within tolerance”. Analysts paint fan-charts that resemble stress balls after a toddler tantrum, yet everyone keeps stacking more wooden blocks labelled “consumer credit” on top. Just don’t breathe too hard or mention the word “contagion” within earshot of the stack. The Big Short is the movie I'll probably watch this weekend, either that or Invasion of the Body Snatchers.

#3: Headlines of the Week

"Gold price sticks to strong intraday gains around $3,340; seems poised to appreciate further" (FXStreet, 01/07/25). Gold extended its rebound, fed by softer US data and dovish Fed chatter. For landlords, a firmer gold price echoes our Gold price surge and flags capital-flight demand for sterling assets. Kicker: When even the dollar looks sketchy, people start hoarding metal you can’t Airbnb.

"Average UK house price dipped by 0.8 per cent to £271,600 in June." (Standard, 01/07/25) - Nationwide blamed stamp-duty tweaks and affordability fatigue for the sharpest drop in two years, dovetailing with our FTSE 350 Home-Goods out-performance as builders stare down margin compression.

Kicker: Sellers now re-brand “price reduction” as a “summer sale” with a free sun-lounger with every £10k cut.

S&P 500, Nasdaq close at record highs, cap best quarter in over a year (Reuters 01/07/25). The index capped its best quarter since 2023 before this week’s pull-back, highlighting the tug-of-war between rate-cut hopes and yield nerves that shapes our S&P 500 row.

Kicker: Wall Street threw a leaving party for gravity; turns out gravity kept the deposit.

Close-up of a volatile red-and-green candlestick price chart for the S&P 500 illustrating the week’s sharp moves in global markets. — *Reach for the stars: S&P 500*

#4: Final Thoughts

Rising long yields, a wobbling equity rally and fresh weakness in headline house prices suggest patience still trumps bravado. Re-underwrite every deal at a 5% gilt and stress-test exit yields 50 bp wider. Cash-flow-positive rentals in undersupplied regional cities remain the safest bet, while prime flips need foreign-buyer bids that may or may not show up.

Closer: If you must catch the falling knife, at least wear chain-mail gloves - and maybe keep A&E on speed-dial.

Current Sentiment: Sell?