Week 20 - 2025 Market Analysis Snapshot by FOBEA

Ben Johnson
May 15
5 min read

Kicking off the Week (isn't it Thursday?) with a Coffee in one Hand and Crystal Ball in the other.

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.

The Green Market Man is happy and the Bull is here. — *The bulls are arriving in force but its not sunshine and rainbows for everyone is it?*

Welcome to WC 12 May 2025 Market Analysis - the Bank of England has swapped its hawk costume for a budget-flights pelican, inflation is behaving like it finally read the memo, and every crypto bro you unfollowed in 2021 is quietly logging back into X. If you were hoping for calm, try yoga; if you’re hunting opportunity, pull up a chair - there’s a clearance sale on debt and a side-order of selective FOMO.

Rates are falling, rents are fattening, and builders look more nervous than a politician in a polygraph lounge. Liquidity’s dripping in just fast enough to keep things interesting (think espresso machine, not fire-hose), while recession odds lurk like British drizzle - annoying, but hardly a monsoon (its unfathomably ironic that Northern England is currently in a drought but nonetheless...) Translation for landlords: sharpen your spreadsheets, oil the umbrella, and practice that humble grin for when cheaper refinancing meets skinny new-build supply.

#1: Market Analysis Snapshot - WC 12/05/25 - Stats pulled 13th May

Indicator (units)	Latest reading	3 month trend	Importance to Investors?
Bank of England Bank Rate	4.25 % (-25 bps cut on 7 May)	⇩ easing	Drives UK mortgage pricing; every 25 bps cut trims c. £15 per £100 k interest-only loan
UK CPI Inflation YoY	2.6 % (Mar 2025)	⇩ disinflating	Real rent growth = nominal rent − CPI; falling CPI lifts real yields
US M2 Money Supply	$ 21.76 tn (Mar 2025)	⇧ +0.8 % QoQ	Global liquidity proxy; expansions often precede asset-price lifts
Federal Funds Target Range	4.25 – 4.50 % (held 7 May)	⇩ first cut likely 17–18 Jun (74 % odds)	Sets dollar funding; GBP swaps track the Fed with a lag (CME Group)
S&P 500 Index	5 892.64 (close)	⇧ new YTD high	“Risk-on” barometer; equity rallies = deeper investor pockets
Global Crypto-asset Mkt-cap	$ 3.32 tn	⇧ +14 % MoM	High-beta liquidity gauge; windfall gains spill into BTL deposits
FTSE 350 Household Goods & Home Construction	11 542 pts	⇧ +3.1 % MoM	Forward view on UK housing supply & build-cost pressure
DJ US Select Home Construction Index	16 465 pts	⇩ −2.4 % MoM	Tells you where US cyclicals are heading—useful for gauging timber & appliance prices
UK Mortgage Arrears (share of balances)	1.3 % (Q4 2024)	⇧ creeping	Early-warning on forced sales & lender credit-box tightening
Recession Probability	UK ≈ 30 % (NIESR est.) / US 35 % (GS)	⇩ easing	Macro backdrop for rent growth, vacancy risk & exit pricing

Next BoE MPC: 19 Jun 2025 - futures imply a 65% chance of another 25 bps cut to 4.00%.

#2: What This Signals for UK Property Investors

Financing tail-wind forming.

With the BoE already two cuts into its cycle and market odds favouring another reduction in June, landlord debt costs are rolling over just as CPI drops back toward target. Expect trackers to reset first, with 5-yr fixes following once gilt yields absorb the trend. Net result: cash-flow cushions widen, supporting higher leverage on new acquisitions. In other words 🤨 The BoE is doing its best impression of a clearance sale: two rate cuts and the market betting on a third next month. Your interest bill is shrinking faster than my patience when looking at the $QNT sideways chart. IYKYK. Trackers will feel it first; five-year fixes will tag along once gilts stop sulking. If you've been moaning about negative cashflow in the UK, start practicing that gratitude speech. 🥸

Global liquidity is back on “drip-feed” not “fire-hose.”

US M2 has turned positive QoQ and crypto-cap sits above the $3trillie mark, showing risk appetite is reviving—but not at 2021 mania levels. Translation: equity and token profits should continue seeping into UK buy-to-let deposits, yet bidding wars will remain selective, focused on high-yield regional stock.

In other words 🤨

CPI has slipped to 2.6%. Real rents (rent minus CPI) are quietly plumping up like a well fed pig 🐽. Congratulations: the same tenants who spent last year telling you bread costs too much (which it does!!!) are now underwriting fatter yields, go figure. So don't gloat (in earshot of others).

Equities flashing confidence, builders still cautious.

A fresh S&P record suggest i9nvestors are comfortable taking risk, but UK and US-house-builder indices lag the broader market. Developers are signalling margin pressure from materials and labour - even before the effect of the Trump tariffs bite. For landlords, that caps new-build supply slightly and cushions rental demand well into 2026.

In other words 🤨

Uncle Sam's Money Supply is creeping and Mr. Powell is itching for that Purple tie 👔 even if he won't admit it (the nichest "joke" i've ever written). Crypto bros are back above the $3,000,000,000,000 (is that enough zeros, I'm losing count) bragging rights. There's money sloshing around but the party is nothing on the 2021 QE Vegas party. Expect selective bidding war in gritty-but-glamourous (I'm northern so I can say that) postcodes, not frantic FOMO across Zone-2.

Stress is building, not breaking.

Mortgage-arrears ratios have ticked to 1.3 %—historically low, yet rising. Combine that with a one-in-three UK recession risk and you get a market that rewards liquidity buffers and disciplined tenant-screening. Investors who baked in 6 %-plus stress-tests last year can ride out a shallow downturn and pick up distressed stock if defaults edge higher.

In other words 🤨

The S&P 500 is doing the cha-cha slide centre-stage while house-builders indices shuffle awkwardly in the corner. Supply pipelines look thinner than a Soho flat insulation. Fewer units = persistent rental demand = you accidentally becoming the beneficiary of someone else's margin pain. Try to look modest...

Macro-micro alignment favours selective expansion.

Falling policy rates, ebbing inflation, robust risk appetite and constrained housing supply converge into a sweet-spot—provided investors stay ESG-compliant and factor in stricter affordability tests. Locking in deals before the next BoE cut can capture both cheaper debt and the eventual cap-rate compression as yields chase lower risk-free rates.

In other words 🤨

Mortgage-arrears nudged up to 1.3%. Recession odds hover around 1 in 3. Its the economic equivalent of the British summer: mostly fine, chance of drizzle, pack an umbrella. Keep a cash buffer and tenant screening like MI5. The bargains comes when the umbrellas sell out.

#3: Play it like a (Cynic) Pro

Refinance or Sit on hands: Check your early-repayment penalties now, before June's MPC meeting turns that 4.25% into a fond memory.
Line up dry powder (boom): Q3 - Q4 could served up distressed stock at Boxing-Day prices: Liquidity is a weapon so load it.
ESG box ticking: Yes You still need insulation, heat pumps, and paperwork thicker than a Victoria sash window. At least pretend you care; the valuer will.

#4: Final thoughts?

The market is teeing up one of those once-every-few-years sweet spots with falling rates, tame inflation and builders with rather sweaty palms. I can hear the bond market whispering "buy cleverly, finance cheaply and don't be a silly sausage."

If you can pull that off (and resist flipping your new gains into a Beyoncé NFT), the next 18 months could treat you very kindly indeed. Go forth, grab those low hanging fruit and maybe even send the BoE a thankyou card while you're at it.

TL;DR: Buy or don't, I'm not omniscient 😆

What are your thoughts? Drop us a like and comment below if you enjoyed the read.

What colour Tie with Jerome wear next?