Yesterday's cut in the Bank of England base rate may have brought the interest rate down to 3.5% and...
Yesterday's cut in the Bank of England base rate may have brought the interest rate down to 3.5% and the lowest level in 55 years, but the Council of Mortgage Lenders believes it is unlikely to have a major impact on the housing sector.
Commenting on the rate cut, CML Director General Michael Coogan says the 0.25% interest rate cut will have little effect on the natural slowdown that is now occurring in the housing market.
"The fact that the Monetary Policy Committee have today decided to cut interest rates confirms that they do not see the current state of the housing market as a barrier to taking measures to benefit the wider economy," says Coogan.
"The Bank's forecasts suggest a slowing down in house price growth to zero over the coming year, and although we expect to see positive growth continue, we firmly believe that the housing market is achieving a natural slowdown. So this rate cut is unlikely to further stimulate the demand for mortgages. Lenders will be watching the markets and considering funding issues in deciding how to react to today's rate cut," he adds.
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