The Bank of England’s Monetary Policy Committee (MPC) is beginning its two-day July meeting, where it is expected to lift rates to 5.75 per cent.
Although rates were kept at 5.5 per cent at last month’s meeting, four out of the nine MPC members wanted a rise.
A leading property expert has questioned whether an interest rate rise would slow property inflation, insisting investors still believe the sector offers substantial growth.
David Austin, Managing Director of property investment consultancy Property for Life, commented that an interest rate rise of a quarter of a percent would make little difference to property investors looking for long-term profits – but would impact on first-time buyers.
The comments come ahead of Thursdays meeting of the Bank of Englands Monetary Policy Committee (MPC), who are expected to agree a quarter percent increase, bringing interest rates to 5.75 per cent.
David Austin said: A quarter per cent rise is not going to strike panic into property investors hearts. Most take the view that over the long-term the property market will continue to perform, and this means they will make a gain when they come to sell.
First-time buyers will have yet another barrier put before them. Gordon Brown talks about wanting to support first-time buyers – maybe now he is regretting giving the Bank of England its independence on interest rates!
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