With inflation at a seven-year high of 1.9% and the minutes of the last Monetary Policy Committee meeting revealing that two members voted for an increase in the base rate, there are fears within the property industry that interest rates could rise in the next few months.
David Bexon, Chief Executive of SmartNewHomes.com, comments: “The four rises last year had an immediate effect on the market and well and truly put the brakes on rising house prices. Prices are now stable across the country with some areas seeing a drop in values. Our fear is that a further rise, as predicted by some economists and hinted at by the split in votes at the last committee, could be the catalyst to a serious downturn in the market.
“Consumers are nervous and this is showing both in the housing market and on the high street, with buyers reluctant to commit to sales and developers turning to incentive packages to encourage buyers. Increasing rates at this time will be the final straw for many homeowners and consumers, especially those with large mortgages, and the unfavourable effects will be seen across the economy.”
To search for a new home throughout the UK of for more details visit www.smartnewhomes.com
