Connells hits out at BoE plan

Connells Survey & Valuation has warned that the Bank of England\'s £50bn cash injection will have little impact on the high street.

Ross Bowen, managing director of Connells Survey & Valuations, says that it runs the risk of making little or no difference to the average first-time buyer.

He warns that it’s unlikely to increase the supply of mortgages currently available to borrowers.

He says: “By swapping these assets for government bonds, we should see retail banks more willing to lend to each other.

“But it’s worth remembering that the Bank of England’s proposals are meant to shift a backlog of debt from mortgage lenders’ balance sheets and get the money markets moving again.

“This is unlikely to enable lenders to ease their significantly tightened criteria. As a result, the man on the street is unlikely to see much benefit.

“Bowen praises the government intervention but recognises the need to a LIBOR review.”

He adds: “The most we can hope for is that LIBOR rates come down allowing mortgage lenders to lower rates for borrowers.

“Having finally acknowledged that the problems in the market are significant, the government must continue to act to rebuild confidence.”