Bank of England Maintains Interest Rates at 5% as Predicted - Good News For London Property

The confirmation by the Bank of England that interest rates will remain at 5% is a a sensible decision for the London property sales market in our view.

The static rate should have little effect other than gently reassuring the market - as the decision had been correctly predicted by most observers and economists.

Estate agents in Notting Hill, Kensington, South Kensington and other prime areas of central London deal with relatively few buyers who are dependant upon high loan to value mortages and for whom affordability is as significant a factor as in other parts of the UK where rising costs of fuel and food are contributing, with increased costs of borrowing and more cautious lending among banks, to a significant cooling of the market.

The buy to let market is also a contributing factor in maintaining house and flat prices in Central London. Th capital is a major international employment centre. If people don't buy, they rent. Thus evening out the market.

Any news that reassures the City and contributes to the longer term stability of London as a world financial capital has to be good news for the London property market.