This has discouraged the MPC from cutting interest rates in February.

178

There are two reasons why the pick-up in activity this spring may not turn out to be strong. Firstly, many first-time buyers continue to be priced out of the market.

176

House prices tend to move seasonally, driven up by higher demand and activity in the warmer months and falling off towards Christmas. Just as the trading period over Christmas is crucial for the retail sector, the spring and summer are crucial for the housing market.

166

The continued rise of our three-month average since October 2005 still shows strength in the market and, significantly, this discouraged the MPC from cutting interest rates in February.

160