Mortgages Direct questions base rate rise

Peter Gladdy, director of Mortgages Direct says the current economic situation is not strong enough to justify a rise in rates.

He says: “The housing market is stable and currently showing modest overall growth but the latest rise in interest rates could cause a substantial change in homebuyer attitudes and significantly dampen activity in the housing market.

“The latest announcement is particularly bad news for first time buyers, who are finding it increasingly difficult to get on the property ladder. In addition, many homeowners are now reaching the end of their discount periods, and they will be exposed to immediately higher mortgage payments.

“Any further interest rate rises will have a devastating impact on a large number of homeowners.”