A LANCASHIRE property expert believes that the interest rate announcement will help to kick-start the stagnant housing market.

The Bank of England slashed the base rate by 1.5 per cent to three per cent, the largest cut since the 1950s, in a bid to help ease credit conditions.

Now, Simon Ainsworth, head of residential property at Napthens Solicitors is welcoming the cut, saying it could be what the housing market needs.

Latest figures from the Halifax show that prices fell by 2.2 per cent in October, taking the total drop in prices to almost 14 per cent in the last year.

Land Registry figures show that the average cost of a home in Lancashire in June was £152,927.

He said: “This announcement is good news as long as the banks react in a similar way.

“Lloyds TSB has already indicated they will follow suit and the cut is a strong and bold move from the Bank of England.

“Whether the lenders change their new products or not, there will be quite a number of people whose mortgages are tracker mortgages linked to the base rate, so their mortgage rates will go down as the base rate reduces.

“This will provide those borrowers with a noticeable reduction in monthly payments.”