Flats to rent in London may be more popular as rate rise tipped
The popularity of property to rent in London may increase as the cost of buying rises, something would be first-time buyers may be hit by as pressure for a base rate increase intensifies.
Figures from the Office for National Statistics (ONS) today (December 15th) revealed the Consumer Prices Index (CPI) measure of inflation has jumped again, reaching 3.3 per cent in November, up 0.1 per cent on October's figure.
This was caused by the largest ever rises in prices between these two particular months food and drink, clothing and footwear and the furniture and household furniture and maintenance, the ONS stated.
With inflation persistently above its two per cent target, the Bank of England Monetary Policy Committee (MPC) may consider hiking the base rate from its present 0.5 per cent, a position advocated in recent months by MPC member Andrew Sentance.
Such a move could push up mortgage costs, making buying homes in London more expensive.
Reflecting on the CPI news, Mr Sentance told BBC Radio 4 he expects a change in monetary policy soon.
He commented: "In terms of broader economic commentary, there is a recognition we're beginning to move into a period where interest rate rises make more sense."
By Chris Price
Published 15th December, 2010
© 2010 Estates IT Limited
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