Expert Comments On Rate Announcement

Expectations that interest rates may rise over the next few months will do little to help those looking to take a step onto the property ladder, an expert at Irwin Mitchell has suggested.

The Monetary Policy Committee chose to hold interest rates at 0.5 per cent last week, but Lisa Shenton of Irwin Mitchell’s Conveyancing team has revealed that some economists believe such a move will not be repeated in the near future.

She explained that a rate increase could be likely by the summer, in a move which would undoubtedly impact on the number of people looking to buy and sell their homes.

 “While rate increases would be welcomed wholeheartedly by savers, it would add more pressure to affordability for house buyers and first time buyers in particular,” Lisa outlined.

“Recent statistics from the Council of Mortgage Lenders and  House Price Indices reports continue to highlight the lack of confidence in the housing market. Confidence fell further during the autumn of 2010 as potential buyers were concerned about the planned public spending cuts. 

Commenting on expectations for the property market this year, she added: “It is likely that 2011 will see similar transaction levels as 2010 with buyers in particular keen to complete by Easter and take advantage of extended bank holidays to decorate and settle into their new homes.”