Rates rise by further 0.25%

Posted: 05 Jul 2007 14:50:19 GMT

The Bank of England's monetary policy committee (MPC) has voted to raise the base rate a further 0.25 per cent today - the fifth hike since August last year.

The Bank of England's monetary policy committee (MPC) has voted to raise the base rate a further 0.25 per cent today - the fifth hike since August last year.

The base rate now stands at 5.75 per cent, as the committee moves to slow inflation and add further pressure to a housing market already showing signs of cooling.

However, many experts claim that the added costs to mortgages are unlikely to have any significant effect, with demand for housing still strong and driving the market.

"Having to find an extra £25 per month, at a time when finances are squeezed, is going to hit first time buyers' pockets but our research shows it's not going to deter them," commented Andy Wiggans from Bradford & Bingley.

"With concerns over future affordability and property prices many are doing everything they can to get on the property ladder as soon as they can."

However, first-time buyers have also been warned not to overextend their finances, with yet another rise widely expected before the end of the year.

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