Rate rise demanded as Sterling's value slides.

Paul, Coventry,

Im potentially a first time buyer. I hope the property market crashes so I can buy a cheap house. If you own more than one property get rid of it now so the rest of us can own a home. Invest your money in a bank instead.

AC, Oxford, UK

Before everyone gets carried away here predicting the colapse of the housing market, remember prices last year rose 1.1%, and most of the falls in property prices have been in apartments where cities have been over delveloped to a point where every old factory/school is now a block of luxury apartments. If you are renting at the moment add up how much rent you have paid, since you became a tennant...its all dead money. There will always be fluctuations in property prices they can not rise at 10% per year, its not sustainable but every time prices fall a crash is predicted. The truth is however we have an ever increasing population who need somewhere to live, either renting or owning, and there is a shortage of houses. Lenders have tightened criteria at present and we will see a rise in reposessions over the next few years mainly as those paricularty with adverse credit come off existing low rate deals..property investors are seeing this as an oportunity

Dave, Sale, Cheshire

A rate cut will only be of benefit if the banks pass on the full cut, rather than use it as a way of bolstering their profits. The banks have got us into this mess and now they expect to be bailed out. The government should insist that the full rate cut is passed on to borrowers as a condition of any future Bank of England loans to the banks.

Ian Gosling, Oakham, Rutland

What everyone seems to forget on this blog is that if the housing market crashes it will be EVERYONE that will be effected. Those that do not own their home, wishing for a house price crash, may regret their stance when they loose their job!

Nick , Barcelona, Spain

The reason why first time buyers cannot afford houses? - because they are too high relative to incomes. Why? Provision of easy credit fuelling speculation and lack of policy action. Solution? Tax second homes more. Prices must fall to a sensible level. The solution is not to give first time buyers financial assistance, it just maintains the bubble and the imbalance.

Peachy, London, UK

"You lot msut be idoits to think prcies will come down just go look at japan, with its genertional mortgages, we live on an over crowded island, with more and more imigrants comeing to live here every day."

Mr Jones, Liverpool, England

Is that the same Japan where house price fell for over SIXTEEN years following the peak in 1990, despite reducing to near 0% Interest Rates?... maybe you should check your facts before calling people idiots!... and why does being an island mean anything? - all countries have borders; the Dutch can't just start building in Belgium any more than we can in the sea.

Also all indication is that immigrants are starting to move the other way with a lot of Poles heading home with the Pound decreasing in value and the Polish economy becoming more attractive.

Mark , London,

I am quite relieved to see the number of people who think rates should be held or raised. The economy should not be based on U.K. house prices it is a totally false measure. Wealth is created by effort, industry and ingenuity not repricing the same old products still on the shelves.

What staggers me is that Gordon can sit on his hands and say and do nothing while the pound tumbles in value by 18% in 6 months. I can't ever recall a P.M. that didn't regard half that amount as a calamity requiring urgent crisis management.

I think I know why Mc Sporon is inactive. On the Andrew Marr show he boasted how he had the treasury buy into Euros. He just thinks he has been clever(cue revolting smug face) and ignors the millons struggling with the adverse consequences.

Just another case of "I am all right jack" Gordon at work.
What's the betting now that even the Labour party will dump him in the vain hope of salvaging something out of the next general election.

Steve Douglas, Poole, U.K.

Usually I admire the Times for its relative impartiality, but as far as sensible reporting on house prices goes they are worse than the others. "Property prices rose by only 1.1 per cent during the past 12 months!”.” Rate cuts demanded!" - Yeah, demanded by Times journalists with buy to lets. Listen, prices in my homeland of Aberdeenshire rose 33% just last year. 33%! Didn't here a peep of complaint from the media then. What percentage of people do these rising prices actually benefit? Only those who own more than one property, surely, in the long term - many others just feel richer. Homes are for living in! A gently falling market does not have to cause recession if it is handled carefully. Like others who have posted, I feel the situation of FTBs is currently ludicrous -older people might not have any reason to care about this, but what do they think this is doing to the country, long term? Do they have any idea how low the birth rate really is amongst graduates in the UK?

RM, Edinburgh,

I believe that a cut to 5% would help stabilise the economy, as a whole. However the BoE should make it clear that, exceptional circumstances excepted (don't ask me to specify these), this will be the last for a while. They should also spell out the inflationary risks we are all facing and confirm, if they can, that the UK economy is resilient enough to withstand the effects of the looming recession in the USA.

George, Woking, UK

Katie Morgan, London, UK. I'm sorry that you will be hit so hard by the forthcoming crash, but the writing has been on the wall for a very long time as shown by sites such as:
www.housepricecrash.co.uk
If you are going to make the biggest financial decision of your life you have to do your homework. You can't expect the banks to protect your interests - that isn't their focus anymore.

Clive, Chichester, UK

What seems to be emerging is a competitive market for loans where collateral can withstand up to a 30% drop in "value" (e.g. HBOS today), but a complete mess of a market for anything else. I take this as a good indicator of what the real experts really think will happen next.

Simon, Etchingham, U.K.

You lot msut be idoits to think prcies will come down just go look at japan, with its genertional mortgages, we live on an over crowded island, with more and more imigrants comeing to live here every day.

House prices in the long run can and will only go up as there simple wont ever be enough for every one who wants to live here to live here.

Ok they might drop a little in short tearm, but if you think all thouse people with 100% mortgaes are going to sell their homes to you at a loss, I have bridge in newyork state to sell you!

Mr Jones, Liverpool, England

The BoE's remit is to control inflation and protect sterling from falling too far, not to sustain an infeasibly large housing bubble

Ian Mills, Hove, Sussex

McBroon seems to be quite proud of 180% inflation in property prices over 10 years.
Why is this good?
Asymmetry in inflation is some how beneficial he seems to claim.

Why was he not asked just how that was good by the sycophantic interviewer. Wouldn't get past Paxman.
No use crowing about interest rates, a shift from 3% to 7% is a huge leap and not comparable with 10% to 15% - it's ratios dummy.

Hell and he's the boss, we're doomed.

Tom Taylor-Duxbury, Ludlow, UK

House prices MUST be allowed to fall. They are over inflated and it is a natural down turn in the cycle. I feel for the few who bought in the last few months but not for the vast majority who have seen huge increases in the value of their homes, especially those multi house landlords.

Rates must not be cut to stem house price falls.

Maybe this is the time to finally abolish stamp duty for first time buyers? This would give some liquidity back to the market and help those of us out who have benn priced out of the market, not those who have 100% growth in 10 years,

Mike, London, London

I am sure falls in property prices are 'containable' especially if your mortgage interest is paid by the tax payer. I suspect they are not so good for those who have stretched their finances to buy their first home.

John, Manchester,

And who exactly is putting the BoE under "intense pressure"? Corrupt special interest groups that were quite happy to stay mum when the bubble was rising.

Slashing rates will lead to higher inflation. Inflation is a tax on savers. I have no desire to bail out borrowers who got too greedy during the good times.

AA, New York,

How chillingly ironic that it is the BOE which is being urged to cut the interest rate they charge to banks and building societies yet, despite already having done so several times, the banks and building societies have not reduced the mortgage rates by coresponding percentages and have instead used the cuts by the BOE to boost their own margins.

Bob Wreford, EXETER, UK

I think those who make comments regarding people who bought property on little or no deposits should bare in mind that we had little other oppertunity to do so. With rents sky high with leaving little room for saving and social houseing near on impossible to access for all but the most needy, people like myself of a very average income had no other choice but to buy on the terms offered. We bought out of necessity rather than greed and are likely to pay the highest cost of all for that. I suspect the bankers who created this will suffer very little! So please bear in mind we are not all in this for a quick £ when making your negative judgements around peoples motives.

Mike , London,

It doesn't make any difference. The banks and building societies increased the mortgage rates already to suit themselves. If the rates go down the banks will not bring them down to the same amount.

The interest rates are for the benefit of the banks and not their customers.

Don't forget its the banks that caused the housing slowdown and their greedy policies. Now everybody else has to pay, so the banks don't lose out.

emily, lancaster, uk

Gordon Brown is finally talking sense - 2.5% is nothing.

Roll on rate rises and property slowdown. Maybe us middle-incomers will finally be able to get on the property ladder.

Sascha, London,

After saving for 7 years to get a 10% deposit, I finally managed to buy a flat in April 07 - just a few months before the credit crisis emerged from the woodwork.

Now, because of banks ignorance and foolish lending policies over the years, I am very likely to fall into the negative equity trap in just a few months time. If banks didn't see this coming, the ones who are supposed to be the intelligent ones, how could a typical Joe Bloggs anticipate this? I'd watched house prices increase since 2000, all that time there was sceptics saying that there would be a crash, but there wasn't - until now! For the FTB, the attitude was you better get in quick otherwise you'll be priced out of the market, as many already were.

If I was still a FTB I'd be delighted at the prospect of house price deflation. But as I'm now a property owner, that paid market prices very recently, I'm absolutely mortified. The losers in this are the recent FTB who saved for years but still had small deposits!

Katie Morgan, London, UK

Why should rate cuts be demanded if property prices became to dip? Rate increases were never demanded when prices soared. Suck it up.

Mike, Madrid,

Ok, so we all know what should happen, very good.

Now the real question, what will Brown do?

Will he protect house prices, well, will he protect his reputation by protecting house prices, or will he do the right thing?

Lets face it, he only has to keep it going for another 18 months, then he can lose the election and hand the short fused bomb over to the Tories.

Dominic, Manchester, UK

Ralph, it's easy to explain why our economy is based on house prices. Times have moved on from the era of doing good for the country. The only political aim today is to attract voters and stay elected. Politicians and government will do whatever it takes to get elected.
And of course, the radar of the voters seldom goes beyond what hurts them personally.

Unfortunately, a party that stood for policies beneficial to Britain would never get elected.

Mike Poulsen, Reading, Berkshire

Ralph, London

Answer-

Because we are a nation of property spivs.
Watch the TV: Location, location, location (revisited), place in the sun/country (revisited), how to be a property developer (one year on), grand designs (revisited), homes under the hammer etc, etc. Listen to the radio: property investment seminars, property finder websites, relaible tradesman websites, equity release cowboys.

What a micky mouse economy.

barry wiseman, bromley, kent

"The Bank of England is under intense pressure to cut interest rates again tomorrow"

I notice that there is no mention of who is applying this pressure. It certainly isn't me as all such a rate cut would achieve would be to negatively impact responsible savers and increase profit margins for mortgage lenders who won't pass on the cut. Resist the rate cuts BoE!

Nick, London, UK

People seem to be concerned with 2 extremes. First Time Buyers who cant enter the market, and the older home owners who have substantial equity, or have borrowed against equity to fuel their lifestyle. What about those who were first time buyers 2 years ago? I bought my first house with a 5% deposit in 2006. It now looks like I am going to struggle to pay the mortgage when the fixed rate expires. Did I overpay or was did I pay the market value at the time? Would it not be far more sensible for people to look at the mortgage market rather than harp on about how they dont own a house of their own and how the people that do, deserve all they get? There is a problem with Mortgage Supply at the moment. Even if BoE reduces rates, will the lenders pass this on? For those who have taken the time to analyse what is going on, you will know, the answer is no. reducing rates makes mortgages profitable for banks, therefore they will start to lend. this wont resolve matters, but ease them

Andrew McLachlan, Huddersfield, England

More than a million immigrants live in homes paid for by the taxpayer. One in nine subsidised homes is now occupied by a migrant family. Housing queues have lengthened by more than half in England since 1997. In London and the South East they have nearly doubled. So It's not just low interest rates that have fueled house price rises.

Robert, Luton,

According to the March figure for manufacturing ( a sector 3 times the size of the much vaunted financial one), manufacturers are actively seeking to pass price rises on.
The credibility of the BOE (and that means that of the members of the MPC) is on the line. If they are seen as a soft ouch watch wages explode and inflation with it.
The RPI (not the meaningless CPI) has been well over the limit set by Brown in 1997 for a couple of years now. So they haven't done a very good job as of late and if they give in to this pressure will merely compound the error.

Eddie Reader, birmnigham, england

The false inflation measure introduced by Mr.Brown has turned the economy upside down. His measure, excluding practically everything that is rising and including luxury electronic goods and cars which are falling is demonstrably false. A figure of 2% or thereabouts when we all can see our living costs rising by between 8% and 10% per annum is a confidence trick. As if that were not sufficient, the 8% or 10% is compounded having a DISASTROUS effect on the pensioners and the lower paid. Add to that an increase of the starting rate of tax from 10% to 20% affects mainly the lower paid whom Labour are supposed to represent and protect. Those of us who have been prudent and saved for our retirement are being penalised by the reductions in saver's rates and on top of that, those of us who have retired to Europe have had a 20% drop in our pensions and saving income because of the drop in the value of Sterling thanks to the disastrous handling of the economy by Brown and his cronies.

Richard, Alicante, Spain

Just remember, Brown gave "Independence" to the Bank of England with the brief to control inflation. The rest of th economy is down to Brown, cutting rates too far now would be a huge mistake, inflation would increase because the pound would fall further against the Euro and import prices would surge. Is that going to help many

KW, Bognor Regis , ENGLAND

Paulie is right that owning a house will remain unfeasible for many people - IF the U.K governments who can't govern allow the present state of affairs to continue. They MUST tax multiple home ownership heavily. That is the only way to stop a whole generation of talent leaving the U.K and leaving us with losers and immigrants!

Neil, Birmingham, U.K

The role of the bank of england should not be to try to keep a housing bubble inflated at the cost of inflation. All that does is cost pain for those of us who didn't take out stupid debt we couldn't afford, and create even larger problems in the future.

Brown is fast losing his reputation and any credibility he may have had as being good for the economy... and I speak as a labour supporter.

Hugh, London,

But the mortgage lenders do not pass the rate on anyway, they keep it for themselves and their shareholders. So it will not benefit borrowers.

CA, Manchester, UK

Who is demanding a rate cut? I’m certainly not. House prices have been overpriced for the best part of 5 years and a healthy housing market collapse will allow first time buys to get on the housing ladder.

Plus don’t people realise that without the first time buyers getting on the housing ladder that the entire ladder will crumble!

Mark, Swansea,

`The BOE is under intense pressure to cut interest rates'

Under intense pressure from whom ?

The report doesnt make it clear who exactly is exerting this pressure, needed to re-inflate the asset bubble. Property prices are still 1% more expensive than 12 months ago. Inflation is only 2.5%, so in real terms the price has fallen by a massive 1.5% in a year. This, after increasing in value by 180% in just over a decade.

Houses are for living in. Why is it necessary that they be spectacular investments also ?

andy, manchester,

So, to help all those borrowers in trouble, the banks/mortgage lenders will demand government funding which, of course they will get and which, once it is handed over, will go towards sustaining dividend payments to shareholders. They will offer low grade security in exchange which this government will accept.

A.Williams, Cradley Heath,

It is high time we looked east tobuy properties. Property prices and real estate in India is booming and will never be affected by the happenings in US or UK despite the politicians shouting from rooftops that it is a global crisis. This is a crisis mainly limited tO US and UK. The amont of black money in India is more than Britain,s GDP and will keep the business booming there.

ajay, birmingham, uk

When did Mr Brown become PM? Circa August 2007, wasn't it?. Since then the £sterling has dropped from ~euros €1.47 to ~euro 1.25 today a 15% depreciation.. The £ was pretty stable before that.
Causasian Brit Emigration is increasing by the day; et cetera, et cetera. No wonder the UK is in serious trouble. Of course Mr Bean blames everyone else. He is of course Mr Prudence - if anyone believes that after his expenses were published.

Not quite on the issue but all this IS AFFECTING the UK Economy.

M. Cawdery, Portadown, Co. UK, EU.

The control of house price inflation was lost the minute banks offered over 3.5 x salary to buy a property. When I bought my first house many years ago, I had to have a 10% deposit and could borrow no more than 3.5 x main + 1 x second salary. It was tight but I managed it by selling my car etc. If the banks or maybe the spineless FSA had done their job and kept a statutory ceiling on the multiplier then we would not have the problem we have now as buyers would not be able to borrow over this amount, which would control House Price inflation. BOE rates would have no effect on house prices then as 3.5 x is affordable regardless of rates (I remember Int Rates at 15%).

I'm for reducing interest rates as most 'real' inflation (mine is at 14%) is not affected by any reductions and this would help the overtaxed population.

House borrowing should be limited to 3.5 +1 x salaries and a minimum of 10% deposit. This would cut the BTL market and house prices would naturally stabilise.

Phil, Rugby, UK

Who's conning who, here? Inflation figures are calculated on the rise in cost of a basket of weighted representative average prices of consumables and services, notably excluding house prices. Whereas an increase in the cost of living, being much more relevant, is the actual additional expenditure faced by individuals as the result of fiscal policies. Whilst inflation may be "under control and almost on target". Our costs are rocketing.

Feb's CPI rose 2.5%. The RPI 4.1%. BUT if one agglomerates the cost of living arising from housing and occupation related costs - finance, utility bills, insurances, council tax, rail/road transport, parking, etc., which are all rocketing - and only then takes the rest of the basket for "disposable" income on food, clothing, entertainment, "the pub", etc., which one generally adjusts to the cut of the cloth, REAL COSTS are much, much increased. Add low-earner tax increases, 100% mortgages, dropping equity and the US factor.

It's coming....

Mike L, Chippenham, Wilts

Sorry to break it to you, people who have "invested" in property portfolios have now discovered prices go up-and they go down, this happened in the 90s, its not the BOE s job to reduce rates to prop up the housing market-they are the Governments agents who know a collapse would ruin the economy-after all its this spending spree thats kept it going the last 10 years, the BOEs job should be to control inflation ONLY.

Steve, coventry, uk

I totally agree with all the postings here saying that the BoE should stay focussed on inflation and not be pushed by the knee-jerk reaction of a failing government to reduce interest rates. Interest rates rising are in my interest as I am a would-be first time buyer with savings towards a deposit. But I'm not stupid. If the BoE pump more money into the mortgage market it makes no difference to me because I have no intention of buying a house until the market correction ("crash", hopefully) is well underway. Property in this country is a total ripoff. Greed along with some sort of keep up with the Joneses mentality stops people seeing sense when they think of buying a house. There IS more to life than being a "homeowner". Right now, my partner and I are laughing our socks off watching all this unfold and the only money I stand to lose is a £10 wager on how much prices will fall!

Emily, Manchester,

Rate cut demand? The latest news is that the pound is falling rapidly against the euro. This will inevitably lead to higher inflation. Therefore the BoE, with regard to its only mandate of keeping inflation around 2%, must raise interest rates immediately.

Alex Ritchie, Salisbury, UK

I think the media should grow up and stop playing politics with the economy. Its a case of lets say anything, including scare mongering, to make Gordon Brown look weak. Selfish and pathetic.

Alex, Hastings,

All this talk only strengthens the view that the Bank of England exists for the sole purpose protecting bankers’ interests; that is why a write-down of property values (that show-up in balance sheets) is a good reason to lower the interest rate whereas a high unemployment rate is NOT.

Save assets first.. assets are more important than people.

Rui, Lisbon, Where the streets have no name

"Falling house prices could be a disaster for homebuyers who bought a property with little or no deposit in recent years."

a) serves them right
b) falling house prices will be a BENEFIT to everybody else

There is no case for a rate reduction based simply on trying to keep artificially inflated house prices up.

Clive, Surrey,

Why should those people who have borrowed more than they can afford or have been too greedy building property empires be helped? Why is the concept of having to put a deposit on a house seen as such a negative thing?

As a young professional saving hard for a deposit, I’ll give up in the bank cuts interest rates.

Richard, London,

I am just about to buy a property, with all this speculation of further fall in house price, better interest rate etc, I wonder if it is a good time at all, should I wait for 6 more months? All confused !

Subashini, London,

So a cut in interest rates is being touted for tomorrow.
I was under the impression that the remit of the BoE was to maintain stability and growth in the economy, not to bolster the most overinflated asset bubble in this country's history.
As for the government's figure for the rate of inflation, is anyone seriously expected to believe their ridiculous claims when we look at the rises in fuel, food, household energy, mortgage prices, taxes etc...

Allan, Inverness,

If the BoE decreases interest rates and inflation increases as a result, thereby eroding my savings, can I sue the BoE for my loss?

Alex Ritchie, Salisbury, UK

People talking about "correction" still live in the 80-s . The era of cheap or easily affordable housing is firmly in the past now. The world has changed. The economic fundamentals are completely different. Prime England property market is becoming truly global. I know a lot of Russians, among others, with pockets full of money waiting for a right opportunity to invest here. Any crash will attract hordes of opportunists. I predict by-to-let market becoming global in the future. Economic slowdown will only endorse it. Mortgage rates will go back to "normal" as soon as uncertainty and fears fade away. There is money to lend, banks just sit on it because they do not know what may happen. This all means that any crash will be followed by a speedy acceleration. We may have a speculative housing market for some years. The BoE is right. It is not about preventing a crash, it is about keeping it stable.

Alex, London,

In the long run, it would be better to keep the interest rates as they are and allow the prices to drop, thus increasing affordability.i

Hamad Lone, London, England

I bought 18 months ago and have about 20% equity in my house now. I'd be quite happy to see prices dip as i can't afford to trade up. My advice to those who have less than 10% equity in their house would be to cut back on luxuries and start paying your mortgage off as quickly as you can, that way hopefully you can stay ahead of negative equity.

Rich, London, UK

Buy a camper van, it makes sense, you can park up in St Johns Wood if you feel like it, maybe Highgate if your feeling adventurous, or perhaps glorious Peckham.

Jon, london,

Changes to bank rates will not have a massive effect on house prices as it's the lenders who are turning people down or unable to get good interbank rates. If you bought a house recently purely for short term speculation, you need your head examining. Everyone knew this was coming, but those with a face and voice in the media just tried to convince us it wasn't. Perhaps the banks - commercial and private - should claw back past bonuses to gain funding. It's greed that caused this whole issue in the first place after all....

Alistair Kipling, Birmingham,

Can any one explain why this country has its economy based on house prices, and why glorified building society managers hold so much sway.

Ralph, london,

If only Brown could apply the same logic of reassurance to global warming. Instead of more taxes and doom scenarios we could have the PM telling us Britain is well placed to cope and that the global temperature rise should be seen in the context of the variations of global tempartures since time began. A two degree variation isn't much to worry about, if it happens at all. Obvious why he doesn't. Global warming is a tax generator and vote winner as is saving careless homeowners and big business. the latter can of course give generously to party funds.

John Walter, Bonn, Germany

Lets ask our selves where this ‘pressure is coming from – not from me or many other people.

The BoEs’ remit is to control the general level of inflation not house prices. Rates were kept extraordinarily low to curb deflation and slowdown 3/4 years ago, few who gained from this worried about the harm this did to the housing market and levels of debt taken on by people. Labour claimed the successes of deregulation – this is now clear as nothing more than impotence on their part.

If we do not allow a quick sharp correction, begin to reward caution and learn our lessons from this mess we are only storing up bigger problems for the future and undermining the UKs precarious position even further. Who cares what the estate agents think?

Ginge, Dubai,

The bank of Englands target is to maintain/control inflation. with this in mind a RATE RISE is needed to curb the terrible price rises in petrol, water, electricity oxygen and anything else you care to mention. Merv will be writing a new letter otherwise!

Jonathan Poole, London, UK

Since when should interest rates be dictated by the housing market. The only beneficiaries of rising house prices are the lenders, estate agents and the lawyers. When will we learn. It is time some common sense returned to the property market. Loans of 100% are inviting disaster and if too much money is chasing too few properties rates should be increased not decreased. The pound is plummeting against the euro so rates should be increased not decreased. Borrowers and lenders must return to the sensible practices prior to Brown's credit binge.

Pete, Barry, Wales

if they reduce rates again then i have finally had enough.

rather than throw money at idiotically high priced houses - i've been trying to save it. i have just £50k (my deposit) saved with a high street bank but obviously giving me a decent rate on my savings is not as important as looking after the lemmings that took the lifetime of debt option. if the rates go down again, i am taking my money out of the bank.

jim, london,

Mortgage rates and house prices are NOT related to Bank Rate, not directly nor immediately. These reflect the balance between demand anf the credit famine - which means how hard borrowers can be gouged. When Bank Rate falls, the greedy banks and building societies which caused the problem increase their rake-off rather than pass the cut on. We should leave this to control inflation, and do the one thing that really can help, improve credit availability.

Noel Falconer MEcon, Couiza, France

The MPC never took account of high house price inflation when they set low interest rates over the past 10 years. Why should they shift the goalposts now there is house price deflation? (Even if the PM wants it).

If they don't stick to their rule of targetting RPI, they lose all credibility, and the pound will sink further against the Euro and other currencies. The recent boom in house prices is an asset price bubble, similar to the Tech stock bubble of the late 1990s. These stock prices collapsed, some people got their fingers burnt, but the wider economy remained robust. This is a 'correction' to the housing market, which will lead to a healthier market and wider economy.

Iain Ballentine, London, England

Anyone who thinks that there is a way back for first-time buyers is seriously deluded. No matter what happens over the next couple of years regarding price drops the refusal of lenders to play ball means that the struggle will continue for those yet to purchase their first home. Imagine all of a sudden that you were able to buy a small,modest house for £60,000 (yeah, right). A 25% deposit = £15,000, still a large sum of money out of the reach for the average young or not so young couple. These properties would then be snapped up by cash-rich developers and yes. there are still plenty of those out there. Price crash imminent? No, but definitely a stagnation. People need a reality check across the board. The plain truth is that we are entering the age where owning your own house is unfeasible for the majority.

Paulie , Leicester, UK

When property was rising at an alarming rate did people ask for rate increases?The BOE job is to control inflation and house price inflation is not included in the CPI.Why should a small fall in house prices result in a cut in interest rates?

stephen hulton, eure, france

If an economy is built on sand then asset bubbles are particularly susceptible to falls. If the UK was a company we would be close to calling in an administrator. We are running up debts peronally, corporately and in the public sector. If foreign investors take fright sterling will collapse. Inflation will take off and we will be a basket case! The way forward will be painful!

David Paget, Washington,

The bubble has to burst at some point. As a potential first-time buyer I'm glad the prices are finally coming down, they were completely unsustainable.

Shaz, Bristol,

The Times should report that it is not within the remit of the BofE to cut rates as property prices slide. This should, in fact, be welcomed as good news for those who are about to start a family and are not willing to pay extortionate prices for a very inflated asset.

Riccardo Tonelli, Gateshead,

where were the demands for increasing interest rates when house prices were jumping 20% a year ?

dick spencer, auckland, NZ

"The value of your investment can go down as well as up and you may not get all your money back." That's the kind of statement attached to ever investment offer. SImilar wording should be applied to people buying homes as investments on large mortgages and to the mortgage lenders offering these loans. This will hurt a few people but rising inflation casued by further falls in sterling will hurt everyone. The Bank should stick to their mandate and make inflation their priority.

Mark Nicholls, Kent, UK

One hates to break this to people, but a fall in house prices is a good thing, at least for people in their 20s or 30s, especially in the (greater) South-East, who at present cannot afford to purchase property. If people did not realise the risks in mortgaging then they must learn a valuable lesson - it is your responsibility to deal with this, not to go bleating to government every time something happens with which you are not happy.

Simply put, any government assistance to people who overpaid for their properties will be yet another transfer of wealth from the younger generation to the older. As the older generation have higher salaries, better pensions and make greater use of the NHS already, this is wholly unjustified. The choice is between a government doing what is right (letting the market work) and what is expedient.

I wonder what Mr Brown will choose?

John Scott, London,

Mysterious how stories of economic catastrophes peak on the verge of meetings of the MPC. House prices have been on the verge of falling (according to headline writers) since 2003; they may now be doing so, and they may even fall by 10 %, but then again over the last decade they have gone up by well over 100 %.

If things do crash, the sadness will be that planning policies and government idiocy have meant that precious little of enduring value will have come out of this boom and (mini) bust. When high land prices rendered viable projects like turning the parking lot/dump I walk past weekly into something useful, the planners (in league with the local "newspaper") stopped it. Now, when they finally get the nod it won't be economic and it will be syringes galore for some time to come. Priceless.

anthony , london, uk

Prices went up at a high rate, they should, need and will come down, the sooner the better. Ridiculously high prices have always done more harm than good in the mid and long term. I feel sorry for FTB's, their parents who help out, anyone with a average paid job and below average. What are people thinking of when they gloat over the unrealistic worth of their home? Does anyone think stepping up the ladder when children come along is nothing short of years more of financial pain after the pain of buying their first home. Have people forgot what it is like to earn, save and spend, who saves now, how many can?

I say let the market find it's own level, build more houses, make it a goal to have affordable housing, life will be better for the vast majority.

You get one life, it's not a rehearsal, what ever happened to quality of life? Is this why most of us know someone who just looks forward to the day they can move abroad. The UK is rip off Britain, too expensive and getting worse.

Miller, Redhill, Surrey

Where were the demands for rate rises when house prices were doubling? In 1997 when Labour came to power Brown said he would "not let house prices get out of control". Not only has he broken that promise but he has blown up the biggest speculative asset bubble in British history. The reason he never did nothing about it was because it flattered the economy and replaced stability through production with accumulation of debt. This has to be one of the most irresponsible economic policies ever. I have no sympathy for those who over borrowed or withdrawn equity from their houses to live the high life. Time to pay up for your ignorance and greed. If prices have risen 180 per cent in 10 years a 50 per cent correction is not out of the question. With banks unable to securitise the debt in the same way anymore this is certainly possible.

Edward, London,

House price drops are a good thing. Working people should be able to buy a home, at the moment whole areas of London where I work (in the public sector) are filled with buy-to-let properties rented to benefit claimants. Benefits claimants are pricing out workers!

We cannot risk more inflation. Interest rates should go up, not down.

Pat, London,

Well maybe I might be able to afford a decent first home at the tail end of all of this. It's strange how so many people like me are actually happy that house prices are about to crash. Boom and bust is real not an economic fantasy. Everyone should have seen this coming. There is no such thing as a healthy economy based on rising consumer debt. The UK and the US has drowned themselves via consumer greed. Maybe now we will perhaps buy stuff when we have capital to afford it not on credit. We are one of the most in debt nations in the world. Guess what, China isn't!

Sean Price, London,

The bank of Englands mandate is to keep inflation on target it is substantially above target even by the cpi which many regard as a hopeless measure of real inflation. The reckless (banks and borrowers) must learn to fend for themselves. Lets have no more talk of interest rate cuts!

Chris, London, UK

Real inflation is through the roof. The BoE stuck to its remit and ignored the damaging effects of rampant property price inflation. It should now stick to it's remit whilst the property market returns to sanity. Brown's supposed economic miracle is now shown up for what it realy was - all smoke and mirrors. The game's up - IRs should rise to control inflation and protect the pound. The country can survive a property crash, it can't survive destruction of the real economy.

Clive, Chichester, UK

This problem was created by cheap easy credit! Unfortunately it has to be paid back! How can this problem be solved by its cause? No it will make the debt hole deeper, i'd like to take this opportunity of saying "told you so".

Tim Walton, Leeds, England

10 years of boom and cheap money ... its going to be another 20 years of paying off their debt. Restrictive lending by banks is now on the cards back to 3.5 times salary and a 25%+ deposit, not seen before by many people under the age of 30. They were too young the last time this type of housing crisis happened.

I just can't see how the government can get people out of the mess this time and we haven't even seen the "Buy to let" sector offloading their portfolios yet which will almost certainly happen and flood the market with properties.

My estimation - 4 years of house price drops before stabilising and a 40% drop in total prices.

Johnny Flare, York, North Yorkshire

If interest rates weren't set to contain House Price Inflation, why should interest rates be used to contain House Price Delation?

George Osborne and Vince Cable are correct.

Global credit problems have impacted on house prices in the UK. But using the interest rate as a tool to provide a steady, sustainable growth in House Prices was beyond the BOE.

Matt, Birmingham,