10 Mar

Sales will fall 'without a rate cut'

Sales will fall 'without a rate cut'

Sales of properties in the UK will dip in 2008 if the Bank of England does not cut the base rate of interest, builder Bovis Homes has said.

Both the economy and the sector could be given a large boost if the bank cuts rates again this year, chief executive at the organisation Malcolm Harris said to Reuters.

He stated that "decisive" action is needed otherwise it is unlikely more normal conditions will be restored in the mortgage market.

"If interest rates do not come down and if the spring selling season is not positive, then we could see volumes will be down in excess of 20 per cent for the full year," he told the news provider.

The firm said that its profits were lower in 2007 and that volumes this year will be below those posted last year unless there is a change.

Last week, the Bank's monetary policy committee chose to leave the base rate of interest unchanged at 5.25 per cent, as it looked to balance the prospect of an economic slowdown with inflationary pressures.ADNFCR-1222-ID-18502388-ADNFCR

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