The Home Builders Federation (HBF) is calling on the Monetary Policy Committee to cut interest rates by at least 0.5% to help prevent the housing market downturn impacting on the wider economy.

HBF believes that an interest rate cut, allied to the £50bn 'special liquidity scheme' package announced last month by the Bank of England, and additional measures from the Government such as a stamp duty holiday would help restore both lender and buyer confidence and get some fluidity back in to the housing market.

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Evidence is pointing to the fact that people do still want to buy new homes, but in many cases are not able to get access to sufficient finance. Stewart Baseley, Executive Chairman of HBF said: "We are calling for this move now, as we believe more immediate action is needed to reduce the impact of a potential housing market downturn on the wider economy and on the Government's ambitious housing targets."

(CD/JM)