Bovis Homes has said that full-year house sales and prices would be lower than last year and called on the Bank of England to bring down interest rates to stimulate the market. Financial Times, The Times, Daily Telegraph, Indepednent

“UK rates are the highest in the western world,” said Malcolm Harris, chief executive. “There is capacity in the economy that is not inflationary and a timely reduction in interest rates would increase confidence.”

Bovis is not directly exposed to the US market where a slowdown in sales has been exacerbated by a crisis in the subprime market.

Harris said: “Northern Rock has had an effect on confidence.” But he argued that “if you chase after volume after Northern Rock, you don’t achieve anything”.

He expected buyers who had disappeared in the autumn to reappear in the spring.

The downturn in the second half of the year meant sales had been lower than expected in the important autumn selling period.

Completions might be as much as 5% below last year’s level, even after the £26m acquisition of Elite Homes this month.