Tuesday, Nov 07, 2006

RICS: We Want an Interest Rate Rise!

LSE: RICS urges BoE to raise rates on Thursday to five-year high of 5%

The Royal Institution of Chartered Surveyors has urged the Bank of England to raise interest rates to a five-year high of 5.00% on Thursday to dampen the housing market and prevent economic volatility. RICS said a pre-emptive rise in interest rates will help to contain inflation pressures and wage rises in the next year, providing for a more stable economic environment.

RICS's demand may come as a surprise as most industry groups refrain from calling for an interest rate hike. With the supply of property coming onto the market falling, house price rises are likely to remain firm into the new year, RICS said

Posted by little professor @ 01:22 PM (373 views)
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23 Comments

1. Surfgatinho said...

I reckon it's a double bluff!

Tuesday, November 7, 2006 01:32PM Report Comment
 

2. inbreda said...

RICS said .... wage inflation .... economic stability .....

Who the F..... do they think they are?

And when are Krusty and Phil provide their marvellous insight? I doubt if the BoE will know what to do without it.

Tuesday, November 7, 2006 01:36PM Report Comment
 

3. Bubbles. . . said...

We must have stability if prices keep rising????!!!!!! Everyones a winner cant go wrong in buying a house even if intrest rates rise ho ho u know that wont happen anyway we are in the Brown miracle economy..Just borrow more thats the answer!...All my freinds have and the money they have made on there houses its small compared to the amount they have MEW'ed its gonna be eaten up by the inflation in houses..House price inflation wipes away your MEW's thats what my freinds say and they have never been happier. One of them is going to retire in 3 years at the rate his portfolio is rising...

Tuesday, November 7, 2006 01:53PM Report Comment
 

4. waitingfor hpc said...

perhaps a new tactic ... ask for a rise in the hope the b of e will refuse so they do not look like they are following advice from VI's ... could be a very clever move

Tuesday, November 7, 2006 02:06PM Report Comment
 

5. markd said...

Perhaps they have realised that a rise or two in the near future is better than the rates having to be hiked much more later to dampen down inflation, with even more catastrophic consequences for the housing market.

Tuesday, November 7, 2006 02:20PM Report Comment
 

6. jimmytennor said...

I think that the 2 rises that will occur in relatively quick succession, will mark the start of the correction. The media seems to be taking more of a 'middle ground' over the last week, as opposed to a previous optimistic outlook. This, in my opinion, will lead to a turnaround in the Reports/News in the very near future - I think we should look at these as the fruition of our thoughts...

Tuesday, November 7, 2006 02:20PM Report Comment
 

7. Ticktock said...

Pre -emptive rise????

A 'pre-emptive' rise in rates would have come some considerable time ago. This is not pre-emptive, it is too late already.

Perhaps RICS would like to start offering social policy advice to the Government too, or maybe military tactical advice for our troops in the gulf ?

Jumped up little shits!

Tuesday, November 7, 2006 02:36PM Report Comment
 

8. Wsn03 said...

This is just posturing. None of the commentators who ask the B of E to do things with rates have any influence over the decision; the bank decide based on the position of inflation vs their perception of the health of the economy.
When VIs come on the news suggesting movements based on economic data:

a) they dont know sod all about the economy so are talking sh*te
b) they are seeking publicity, B of E doesnt listen to peoples opinions printed in the newspapers

Tuesday, November 7, 2006 02:51PM Report Comment
 

9. paul said...

I think its far more likely that RICS sees a rise as inevitable, so this expression of "approval" will make the public believe that RICS has influence over the BofE.

Tuesday, November 7, 2006 03:20PM Report Comment
 

10. Titchstarling said...

I've just been speaking to a local Estate Agent. He has got himself out of the property market, sold his house in order to rent! Erm...rats...ships and sinking come to mind! He can't wait for the rates to rise. 5.5% he predicts.

Tuesday, November 7, 2006 03:30PM Report Comment
 

11. Captain Wildman said...

Absolueltly cast iron 0.5% raise on Thursday ....watch this space....US HPC + inflation + fear factor

Tuesday, November 7, 2006 03:36PM Report Comment
 

12. monty said...

RICS are like the National Association of Estate Agents in that they represent a group of people making money on turnover although they may be a tad more savvy when gauging the real value of a property. If sales volumes decrease because prices are too high, like they did in the USA, then the CS crowd don't make their money.

Although this doesn't seem to be the result of one, the RICS surveys annoy me in that they are usually something nebulous like "43% percent of our members say prices are going up and the rest say they are going down." So, nothing useful to report then?

Tuesday, November 7, 2006 03:41PM Report Comment
 

13. Boarder said...

What's wrong with rising wages? the whole of economics has gone mad.

Tuesday, November 7, 2006 05:00PM Report Comment
 

14. indiablue19 said...

Monty's got a point. Getting TOO greedy could kill the goose that laid the golden eggs. There may not be so many eggs, but at least there will still be some.

Tuesday, November 7, 2006 08:11PM Report Comment
 

15. Ticktock said...

the whole of economics has gone mad.

..Thats because it isn't real anymore. The old system failed (2001), and was replaced in desperation by 'casino capitalism' (which is in trouble already) Nothing seems to make sense any more for a very good reason.....Its complete make believe.

Oh what a tangled web we weave....

Tuesday, November 7, 2006 08:34PM Report Comment
 

16. geed said...

A single 0.5% hike would turn the housing market through pure sentiment alone, the BoE will not want this to happen even thought this is not "officially" on their agenda. The housing market is the UK economy and the BoE - more importantly the individuals on the panel - will not want to be the punchbags of the media/politicans when the UK hits a recession as a result. The Economy is on a knife edge and has been for some time. Insignificant 0.25% rise it is then....gently, gently now. There will be no boat rocking here.

Wednesday, November 8, 2006 05:15AM Report Comment
 

17. Nohpc said...

0.25% is not an insignificant rise.. it is a huge rise for many people and I believe will have the desired effect.. if not then one more rise should do the trick. The only way it can be said to be insignificant is if you are praying for a house price crash which nobody apart from renters are.

Wednesday, November 8, 2006 07:30AM Report Comment
 

18. devil's advocate said...

I'll take that bet Capt Wildman

Wednesday, November 8, 2006 08:51AM Report Comment
 

19. inbreda said...

News today in teh Daily Mail that a 0.5 increase in interrest rates causes a 10% in most peoples debt repayments.

And people coming to the end of 3 year fixes are finding themselves suddenly paying 33% more.

It will take time for IR hikes to work their way through, but it shows how sensitive the UK is to any IR Rise at all.

Wednesday, November 8, 2006 09:48AM Report Comment
 

20. tyrellcorporation said...

I don't know about you guys but I'm at my most confident about a decent correction now as I have been for the last 2 years... I've invested a lot of whingeing over the last couple of years and finally it looks like holding out 'til the bitter end will pay off...

Stories like the 125% mortgages just make me smile now - it's the last desperate gasps of air from an imploding market... Bring it on!

Wednesday, November 8, 2006 10:36AM Report Comment
 

21. jimmytennor said...

Agree completely Tyrell - I posted yesterday on another article, echoing your sentiments. The 3 year fixes ending will be a shock to many individuals, coupled with ever-increasing debt-burdens, I can see no other outcome. First 6 months of next year will be the telling point - esp. if IR are raised once more in the New Year.

Bring it on indeed!!!!

Wednesday, November 8, 2006 10:43AM Report Comment
 

22. Bubbles. . . said...

Horray to the 0.5% intrest rate rise. This will be a lesson to the huge amount of speculative idiots that still see a last rise before the correction the pass the parcel game of property will be over,first time buyers should wait. I feel so sorry for the last person to get the parcel and take the wrapping off cos he will be waiting years to buy some wrapping paper to start the passing again...Iceberg ahead.!!

Wednesday, November 8, 2006 10:45AM Report Comment
 

23. Bubbles. . . said...

Hope there is a correction of around 20% this means that the 200,000 pound property will lose 40,000 making a realistic price of 160K for a 3 bed....Please bring it on!!!! Glad I have not bought! When my freinds were all saying buy buy buy..Or you never will! What re they going to say now sell sell sell before you lose lose lose!!

Wednesday, November 8, 2006 10:49AM Report Comment
 

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