When the Bank of England left interest rates on hold two weeks ago week, first reactions were of disappointment that home loans are not about to become even cheaper.

Many experts, however, think the next rate cut is only a matter of time.

With house price inflation cooling off, mortgage broker Charcol predicts a base rate cut early in the New Year, maybe even next month, to prevent the slowdown from becoming painful.

Housebuyers, it seems, have little to fear in the current environment.

Yet Britain's building societies have 2.5 million borrowers on their books and 15 million savers. Nobody worries about savers at times like these.

The irony is that savers are getting cleaned out in a year in which they have pumped near-record sums into building society coffers.

Society net receipts in July, for example, totalled £880 million, almost triple the figure for July 2001.

Savers find building societies a warm, comforting refuge away from dark and dangerous stock markets.

Since the middle of the summer, societies have been methodically chipping away at savers' rates.

Many older investors who monitor every penny spent at the supermarket on the weekly shop have lost money by the bagful in the second half of the year without batting an eyelid. With Bank of England rates unchanged all year, they reckon interest paid on savings has hardly changed either.

The reality is rather different.

In October, for example, Moneyfacts recorded cuts up to 0.25 per cent by West Bromwich, First Active, Mercantile Building Society and Cheshire Building Society and Earl Shilton Building Society.

Dunfermline scrapped some accounts and replaced selected products with reduced rates up to 0.45 per cent.

Rachel Trussel, of Moneyfacts magazine, said: "Tactics vary from one society to another. Rate cuts really began to flow in about June/July, and not many institutions have avoided them since then.

"Some cut two accounts one month, and two more accounts the following month.

Others tinker with their highpaying accounts."

Tiered interest rates, devised to deliver higher rates on larger deposits, also fluctuate unpredictably.

First Direct Bonus Savings, for instance, pays a meagre 1.24 per cent on £1 upwards, surging to 3.93 per cent on £3,000-plus. So savers with £2,000 in the account lose out badly.

Anna Bowes, of Chase de Vere Investments, said:

"Building societies prey on people's inertia, with more success than you might expect. The big change is premiums paid on money locked into 60 or 90-day accounts and only released within that time on payment of a penalty or loss of interest have largely melted away.

"It makes more sense now to shop around for the most generous Easy Access accounts. When they become uncompetitive, close them and move your money elsewhere."

Anna Bowes cites three rate cuts as particularly niggardly:

Bradford & Bingley's 60-Day
Plus Account: Rate on £10,000 investment cut from 2.2 per cent to 2.05 per cent gross. Net return of 1.64 per cent for standard rate taxpayers isn't even matching inflation at 1.7 per cent.

Abbey National Investor 60
is another 60-day account. On £2,000-plus, gross return is down from 1.3 to 1.15 per cent.

Abbey National Choices
Bond has a one-year variable rate. Between £1,000 and £9,999, gross return is down from 2.65 per cent to 2.4 per cent.

Ms Bowes says: "To some extent, societies rob Peter to pay Paul. That's the nature of their business.

"What's particularly naughty about Abbey National is it is pays a very high 4.4 per cent rate from £1 upwards on its internet account eSaver.

"The suspicion must be that young savers with small deposits are favoured at the expense of older customers with larger sums who leave accounts untouched for long periods and don't pay close attention to what is going on."

At brokers Charcol, Ray Boulger believes more and more savers could become seriously disgruntled in the months ahead.

He said: "When base rates were at ten per cent, people tended to leave money where it was if it earned close to that figure "In today's low inflation environment, however, it makes a real difference to savers if they miss out on 0.25 per cent of interest and so money moves between different accounts faster than before."

Societies will continue to cut rates, says Mr Boulger, because the cost of money in the money markets is also dropping. Why pay higher rates to savers when money is available cheaper elsewhere.

So where do borrowers go from here?

Although the top end of the housing market, more than £1 million, seized up so suddenly in the past three months that prices may already be falling, there is no sign of activity slowing lower down the market.

Rates could fall further soon. But buyers may have to adapt their loan strategy soon, and fixed rates may no longer be the best bet.

Mr Boulger said: "Although fixed rates are down sharply, they won't go much lower in the next month or two.

"Borrowers on standard variable rates should switch and remortgage to a competitive rate.

"Rates are now so low (on both fixed and tracker/discount loans) even borrowers who face redemption penalties on their current loan may find it worthwhile to switch."

The best bet if rates go lower, says Mr Boulger, is almost certainly the base rate tracker. Standard variable rates, by contrast, will probably lag behind further rate cuts.

Mr Boulger tips Yorkshire Building Society's tracker at bank base rate minus 0.35 per cent for two years, with redemption penalties charged only in those first two years.

He also suggests a Charcol exclusive, funded by Mortgage Express - bank base rate minus 0.3 per cent (currently 3.7 per cent) for two years -

with no penalties, payment holidays and ability to reborrow any money overpaid.