Mark Carney, Governor of the Bank of England announced last week that interest rates will remain the same until unemployment falls below 7%. With unemployment currently standing at 7.8% many, including Mr Carney, believe that it could take up to three years to reach this point.
Mr Carney believes that holding interest rates as they are will boost GDP by up to half a percentage point. However if inflation gets out of control, the Bank of England will look at readdressing their position.
In light of the announcement we asked Anne Currell how she thinks the measure will affect the property market.
“The continuation of historically low interest rates is good for the housing market and good for business. The initiative offers clarity and certainty to businesses where confidence is much needed. As a note of caution however there is some concern that the threshold to trigger a rate rise may be reached before the predicted date of 2016 – although this would be positive for different reasons as it would mean that 750,000 new jobs have been created.“