Further house price growth expected
Posted: 03 May 2006 09:40:21 GMT
With a series of recent surveys pointing to sustained house price growth in the UK, the Centre for Economics and Business Research (Cebr) expects the trend to continue.
It is generally agreed that 2005 was a difficult year for the housing market in the UK and a number of analysts at one stage suggested a property market crash was on the cards.
While this never materialised, the slump was pronounced and confidence quickly evaporated at all levels of the market. The Christmas months, however, were surprisingly strong and the recovery has continued in earnest during the first quarter of 2006.
The Cebr has announced that it expects this growth to continue into the second quarter, assisted by the buoyancy of the financial market, international monetary flows and a positive forecast for the UK economy.
As unemployment rises and buyers struggle with higher energy bills, however, it is argued that house prices will begin to ease in the second half of the year.
Despite this, house price growth in 2006 as a whole is likely to be higher than in 2005, according to the Cebr, thanks to the affordability of mortgages.
House price growth is expected to remain strongest in the south, supported by higher wages and bonuses in the financial sector.