Will MPC caution cause housing slump

Since it became clear over the latter weeks and months of the summer that the UK housing boom was slowing down, speculation over interest rate cuts has emerged. What had begun as a question of when rates would rise to six per cent has become first a gradual realisation that the 5.75 per cent rate was likely to stay put for some time, followed by talk of cuts. The responsibility of the Bank of England s monetary policy committee (MPC) is of course the maintenance of consumer prices index (CPI) inflation within a percentage point of the two per cent target set out by the government. House prices, which are not part of the CPI, are no responsibility of theirs. It was natural enough that http://www.assetz.co.uk/">UK mortgage rates should rise after the CPI rate burst its banks by reaching 3.1 per cent in March, obliging Bank of England governor Mervyn King to write an open letter to the chancellor explaining what the MPC was going to do about it. But CPI has since plummeted, falling below two per cent in each of the last three months. Thus the case for a rate cut has emerged. The MPC has held back, unanimously in August and September and with just one dissenting voice this month, from making any change, explaining in its minutes that the situation in the economy is uncertain and the effects of the credit crunch need to be observed. Such an approach was described as "wait-and-see", but this month s MPC committee minutes suggested the November inflation report might provide the clear guidance they were looking for. Howard Archer, chief economist at Global Insight, told the Times: "The October MPC minutes indicate that a November interest rate cut is a genuine possibility. The minutes reveal that the MPC discussed the case for a rate cut in October, with David Blanchflower favouring such a move." But a cut which could boost the UK housing market http://www.assetz.co.uk/">property mortgage just when it seems to be in decline may be a bit less likely now. MPC committee member Kate Barker, a housing expert, told a gathering of businessmen in London yesterday: "Not all of the changes since early August imply downward pressure on inflation. Upward pressures from commodity markets, in particular the oil market, remain a concern." Those words may come as a major blow for those hoping to see the housing market boosted by a cut, plus of course those struggling with mortgage payments. Ms Barker herself said that she didn t expect there to be a "significant" downfall in the housing market, since there was no expectation of overall economic maelstrom or higher unemployment anytime soon. Recent predictions of when the MPC will cut rates have tended to suggest next year is the best bet. The most recent example came from Barclays Capital, which this week tipped rates to next be cut in February 2008, followed by a second 0.25 per cent cut in May, Bloomberg reported. If such predictions are true, the housing market may have to ride out a lengthy period before the respite of a rate cut arrives. As it happens, the November inflation report is not out until the 14th of the month, six days after the next MPC rate decision is due. Thus it may be that the MPC holds back in November and instead moves in December, should a favourable report produce widespread expectations of a cut. It may be that a reduction next month is off the cards, but that still leaves one more chance for a reduction this year.



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Luxury villas in India!

Now owning your dream home in Bangalore s Royal Garden Villas & Resort has become easier. Surrounded by the lush green landscape of north Bangalore, with the Nandi Hills framing the skyline, Royal Garden Villas & Resort helps you escape from the madding crowd of city life and take refuge in a world of peace and elegance with all modern amenities.
Spread just outside the IT city, Royal Garden Villas & Residential Resort is perfectly situated near the new Devanhalli Airport and new Apparel Park. The luxurious residential community, with a European style village nestled at its heart, features resort styled privileges including concierge services, a wealth of recreational amenities and daily housekeeping with room services.
According to Manoj Benjamin, Chairman and Chief Executive Officer of Royal Indian Raj, who decided to channelise his earnings into India through his Vancouver-based Royal Indian Raj International Corporation, Royal Indian Raj s goal is to be a real estate pioneer in modernizing India. The Royal Garden Villas & Residential Resorts is a first and a crucial step in our dedication to boosting the real estate market in India. You can secure your luxurious living future by buying a home at the Royal Garden Villas & Resort and, in doing so, you can also cement your role as a brick in the foundation of India s dawning real estate boom.
In the next 10 to 15 years there is going to be a radical change in the Indian real estate industry and those who are able to get in now, on the ground floor with projects like the Royal Garden Villas & Resort , are going to benefit tremendously, he says.
Many world-famous celebrities also feel the same about the Royal Garden Villas & Resort . Ace tennis player and Royal garden Villas brand ambassador, Vijay Amritraj, says, It gives me great pleasure to be associated with an international brand that stands among the best in the world Royal India Raj believes India deserves world-class properties built to international standards of superior quality and design.
Golf icon Jack Nicklaus was only proud to put in a Jack Nicklaus Signature Golf Course at the Royal Garden Villas & Resort .
It is a great privilege to be associated with a prestigious company like Royal Indian Raj Corp, says Nicklaus.
They have established themselves as pioneers in the Indian real estate sector and we are excited about the opportunity to be part of the company s entry into the golf sector. India is home to a fifth of the world s population, and we embrace the challenge, as does Royal Indian Raj, to create an environment where people will enjoy living and playing. I think Royal Indian Raj s goal is to set the standard for golf and residential communities in India, and I think we share the same vision.
The developer of the plush villas, Royal Indian Raj International Corporation (RIRIC) combines a commitment to the highest possible international standards in building and design, with unique knowledge of India s past, present and future. With offices in US, Canada and India, RIRIC is an international corporation. OCO Consulting s Monthly Investment Monitor (Sep/Oct 2004) has termed it as India s largest foreign direct investor. For more information on Real Estate Agents, MLS visit Propertiesmls.com
Source: IndiaRealEstateblog



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