Nearly six in 10 Primis brokers (59%) expect the Bank of England to raise its base rate during the second half of this year.

In a series of surveys conducted at recent Primis events, some 14% of respondents thought an increase was ‘very likely’ this year while 44% thought it ‘likely’. Almost a third (28%) considered an increase unlikely, while 13% were unsure.

The prospect of higher borrowing costs comes at a time when the majority of households are still struggling with the cost of living.

Some 61% of brokers said day-to-day living costs including bills, food, and energy were having the biggest impact, ahead of global events at 19% and mortgage rates and borrowing costs at 11%.

That pressure on household finances appears to be feeding into customers’ appetite to borrow. More than half (58%) of participants said customers were becoming more cautious or delaying decisions, while a further 20% said customers were increasingly prioritising shorter-term fixes.

More than two-thirds (67%) named the remortgage market as providing the fastest-growing area of consumer demand at present, considerably ahead of first-time buyers at 22%. Later life lending and equity release followed at 4%, with buy-to-let at 3%.

Brokers surveyed broadly expect demand for advice to rise over the next six months.

Almost two-thirds (63%) anticipate an increase compared with 29% who expect it to remain unchanged, and 9% who foresee a decline.

Demand for protection is also showing signs of increase, with 46% of brokers saying so. Almost a third (31%) said demand remains broadly unchanged, while 24% observe a decrease.

Primis head of sales Michele MacGregor said: “The overwhelming feeling from Primis brokers at our recent mid-year events is that borrowers are preparing for the possibility that rates could rise again before the end of the year.

“That prospect, combined with a continued strain of higher household bills, is making many borrowers more cautious. But caution does not choke activity, and with an estimated 1.8 million fixed-rate mortgages due to mature this year, large numbers of borrowers will still need to take action in the second half of the year, which should sustain activity for brokers.”