Post by Kev on Feb 7, 2004 5:36:36 GMT -5
CAPITAL of Culture will protect Liverpool's booming property market from the Bank of England's interest rate rise.
Home-owners were hit with a hike in mortgage costs after the Bank yesterday increased interest rates by 0.25pc.
The increase to a 4pc base rate represents the first jump in the cost of borrowing since November and follows encouraging economic growth and rising house prices.
But economists and property experts last night said Capital of Culture, which will create an estimated 14,000 jobs, will protect the region's economy and property market from the effects of more expensive mortgages.
Peter Stoney, senior fellow in economics at Liverpool University, said: "There is so much momentum in Liverpool from Capital of Culture that I think this will have next to no effect.
"There is far too much happening in the city now. If this was to continue though and there were to be more interest rate rises it might be a differ-ent story."
Yesterday's decision adds around £10 a month to an average £65,000 mortgage, based on a standard variable rate of 6pc.
Nationwide Building Society, Abbey, Barclays, the Woolwich, Sainsbury's Bank and First Direct all increased their mortgage rates by 0.25pc following the Bank's announcement, while others said they were reviewing the situation.
Estate agent Philip Lawton of Sutton Kersh said: "The housing market is still buoyant and there is enough confidence to ride out the rise.
"The base rate is still a long way below the double figures of the times of recession. We are sheltered a lot here and a lot of that is because of Capital of Culture."
Home-owners were hit with a hike in mortgage costs after the Bank yesterday increased interest rates by 0.25pc.
The increase to a 4pc base rate represents the first jump in the cost of borrowing since November and follows encouraging economic growth and rising house prices.
But economists and property experts last night said Capital of Culture, which will create an estimated 14,000 jobs, will protect the region's economy and property market from the effects of more expensive mortgages.
Peter Stoney, senior fellow in economics at Liverpool University, said: "There is so much momentum in Liverpool from Capital of Culture that I think this will have next to no effect.
"There is far too much happening in the city now. If this was to continue though and there were to be more interest rate rises it might be a differ-ent story."
Yesterday's decision adds around £10 a month to an average £65,000 mortgage, based on a standard variable rate of 6pc.
Nationwide Building Society, Abbey, Barclays, the Woolwich, Sainsbury's Bank and First Direct all increased their mortgage rates by 0.25pc following the Bank's announcement, while others said they were reviewing the situation.
Estate agent Philip Lawton of Sutton Kersh said: "The housing market is still buoyant and there is enough confidence to ride out the rise.
"The base rate is still a long way below the double figures of the times of recession. We are sheltered a lot here and a lot of that is because of Capital of Culture."
