Estate agents call for interest rate reduction

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Estate agents call for interest rate reduction

Tue 4th Mar 2008

The National Association of Estate Agents (NAEA), the UK's leading professional body for estate agency personnel, has called for a reduction in interest rates.

Peter Bolton Kind, chief executive of the organisation, said that prospective homebuyers are being "squeezed" by the banks' demands for bigger deposits and better credit ratings as a result of the credit crunch.

He also noted that banks are keeping their interest rates significantly above the base rate, meaning that consumers, especially first-time buyers, are having to perform the near-impossible feat of finding bigger deposits and funding higher payments, while inflation continues to rise.

"The situation is by no means dire," he said, "but the result could be very different if the Bank of England does not act now".

Mr Bolton therefore called on the Bank of England's monetary policy committee (MPC) to "act fast" to prevent the housing market from stalling amid an ongoing lack of confidence.

The bank lowered interest rates to 5.25 per cent in February, but is expected to keep them at the same level as fears about rising inflation grow.

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