The Bank of England's decision to increase the interest base rate yesterday is unlikely to impact strongly on the new homes market, according to one firm.

Scottish housebuilder Mactaggart and Mickel told the Herald that high demand would support the sector in the face of such hikes.

Ed Monaghan, managing director of the firm, commented: : "Most economists know that an increase in interest rates takes 12 to 18 months to fully impact on consumer price inflation. This hike will be no different.

"However, in terms of its impact on the new homes sector, I do not believe this rise on its own will impact significantly on sales given the current demand in the sector.

He added that interest rates were widely expected to fall back again before the end of the year.

Mactaggart and Mickel is involved in the construction of new properties in Edinburgh, Ayrshire and Glasgow.

In March it announced its sponsorship of soprano Deborah Voigt to appear at the Edinburgh International Festival this summer.