Paul Fincham, press spokesman at Halifax, said: “We expect the base rate to fall to 4.25 per cent by the end of next year. We think rates have now peaked at 4.75 per cent and that the Bank of England will steadily reduce the rates throughout 2005.”
Ray Boulger, senior technical manager at Charcol: “We’re 99 per cent sure that base rates have peaked but the key question is how far will they fall and when.
“We predict that interest rates will go down to 4.25 per cent by next year, with the first quarter cut being made in the first quarter of 2005 and the second cut coming at the end of the first half of the year. The housing market will benefit from a rate cut but the Bank will be careful not to stimulate the market too much.”
Joe Wiggins, press officer at Nationwide Building Society: “We expect the base rate to rise from its current level of 4.75 per cent but it is unlikely it will go beyond 5 per cent, which we think it will stand at by the end of 2005. Sometime in the new year we forecast one more rate change to occur.”
Sue Anderson, head of external affairs at the CML, said: “We wouldn’t rule out another 25 basis point rise in the base rate during the course of next year, but we would be surprised if the rate stood at more than 5 per cent by the end of 2005.”
Savills Private Finance said: “We believe that rates are close to their peak, with another possible quarter per cent rise at most. After that, we believe it is a question of when they start falling again.”
