SmartNewHomes.com fears for market’s future

SmartNewHomes.com says the Bank of England’s decision to rise the interest rate could prove bad for the market.

David Bexon, managing director of SmartNewHomes.com, says: “The 0.25% rise was a dangerous decision and could prove extremely detrimental to the market. The Bank of England would have been well advised to listen to recent calls from industry and hold rates, at least until the end of 2006.

“The new homes market has slowly started to show signs of growth over recent months, with the average price of a new home up in October, for the first time since May. A rise in interest rates now could seriously damage buyer confidence at a time when recent growth has been predominately restricted to London and the South-East.

“Many home owners, particularly at the lower end of the housing market are still adjusting to August’s rise and another increase will see even more first time buyers priced out of the market, often having to remain trapped in an unsuitable property.”