Base rate 'heading towards zero'

News Category: Industry News

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Interest rates will be cut next month and could stabilise at zero or 0.25 per cent for a long time, a senior economist has predicted.

Charles Davis from the Centre for Economics and Business Research said the base rate could stabilise about this low level throughout the rest of the year and into 2010.

"It's not exactly clear whether it will get to 0.5 or 0.25 and stop but we think that it could well go down to as low as they are willing to go," he commented.

Last month the Bank of England cut interest rates by 50 basis points to 1.5 per cent, which is currently the lowest level in history.

However, although the economic crisis is affecting many landlords, letting agents could continue to see demand for property management services from professional rented accommodation owners.

This is because a survey by Business Development Research Consultants this week found that 100 per cent of landlords with 20 properties or more are making a profit and expanding their portfolios in the current climate.

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