Mortgage holders would have liked an interest rate cut

Published: November 09, 2007

People with mortgages would have liked the Bank of England to have reduced interest rates yesterday (November 8th), an industry body has suggested.

The Bank's Monetary Policy Committee (MPC) opted to fix rates at 5.75 per cent, but the National Association of Estate Agents (NAEA) said that a drop in interest rates would have been warmly welcomed by consumers with mortgages.

Peter Bolton King, chief executive of the NAEA, explained: "I would have hoped that the Bank of England would have considered this month's rate movement carefully as confidence in the market needs to be restored and a relaxation of interest rates would do just this.

"The last 12 months has been an extremely busy period for the housing market and consumers are crying out for reassurance.

"Many housing market reports, including the NAEA survey, clearly indicate that the housing market is slowing down on a monthly basis and agents have expressed concern on the reduced activity."

In the last 12 months, the MPC has increased interest rates four times, putting increased pressure on people with variable-rate mortgages and those coming to the end of fixed-rate deals.