The crisis afflicting Britain’s house builders is set to add tens of thousands to the unemployment count over the next few months, senior industry figures warned yesterday, amid deepening gloom in the property sector.
As alarm bells were ringing among builders, the Bank of England decided to leave interest rates unchanged at 5%, with the monetary policy committee boxed in by the opposing threats of persistently high inflation and a slowing economy.
The Bank wants the economy to slow sharply to ensure consumer price inflation falls next year after peaking, probably well over 4 per cent, later this year.
Any slowdown will be particularly concentrated in the property sector, where homebuilders are rapidly scaling back their ambitions. Halifax, the mortgage lender, yesterday reported house prices were 6.1% lower in June than a year earlier.