HOUSEBUILDER George Wimpey said higher interest rates were continuing to take their toll on the housing market.

The group said it expected slower trading in the UK to have a modest effect on sales volumes during the rest of the year following the recent string of rate hikes.

Customers were taking longer over their purchasing decisions and any recovery since the summer had been limited and bolstered by increased advertising and marketing incentives, Wimpey said.

But it added that levels of visitors to its sites had remained healthy and that there was continuing evidence of sound underlying demand from customers.

Wimpey employs 200 people in the North-East and has recently been involved in building Manor Fields, at Wynyard Park, Birkdale View at Consett, County Durham, and Meadow View at Ingleby Barwick, Stockton.

George Wimpey said at the end of July that the four interest rate rises since November and intense media coverage of the housing market were causing house price inflation to fall to more sustainable levels.

It said the further rate rise in August and more press speculation about house prices had continued to influence customers' behaviour.

This reflected a more normal pattern of autumn trading than the abnormally strong market conditions in the third quarter of last year.