RICS' response to Bank of England ¼% interest rate rise May 04

Though the housing market has shown renewed strength since the New Year the

full effect of increased borrowing costs will not be felt for some months

and we expect house prices to slow in response to higher interest rates

towards the end of the year.

However, strengthening economic conditions are yet to be confirmed in

manufacturing output and business investment, and with inflation very low,

further rate rises should be resisted until there is solid evidence that the

UK recovery has become more broad based.