Robert Sinclair, AMI Director, said: "The 50 basis point cut is recognition that there are still fundamental issues facing the economy, which the Government needs to address. While not inconsequential, the Committee's decision will have little impact on the real problems faced by the mortgage market. In order to do so the Bank and the Government must tackle the burning issue of a lack of liquidity. This is what now holds back the market and it will not be solved by a further cut in the base rate.
"It was heartening over the last 24 hours to see widespread agreement with AMI's position that much more needs to be done urgently. We have consistently called for concerted action over the last 9 months to address the underlying issues in the market.
"The Government must fully implement the recommendations of the Crosby Review of mortgage finance and ensure that sufficient funds are available for lenders. In addition the Government should consider ways to remove ‘bad loans' in order to restore confidence in the market place. AMI will continue to call for these urgent changes."
