House price fall unforeseeable

Posted: 21 Mar 2007 11:51:22 GMT

It would take an economic disaster to make house prices fall in the foreseeable future, according to industry experts, with public expectations of the market driving growth.

It would take an economic disaster to make house prices fall in the foreseeable future, according to industry experts, with public expectations of the market driving growth.

The predictions came at public relations firm the Wriglesworth Consultancy's annual Great Housing Debate, where economists expected optimism and a strong economy to keep the property market healthy.

Chief economist at Morgan Stanley David Miles said: "Public expectations regarding house price growth is key to the market's stability. Growth would need to fall successively for a number of months before people's expectations, and therefore prices, were seriously impacted."

Nigel Terrington of Paragon Mortgages asserted: "A serious correction in the housing market traditionally occurs as a result of a sharp economic downturn, which looks extremely unlikely."

Last week the Confederation of British Industry forecasted the UK economy would grow at faster levels than previously predicted.

In December, UK gross domestic product was expected to grow 2.7 per cent in 2007, but the organisation has now upwardly revised that estimate to 2.9 per cent, highlighting the country's strong economic conditions.


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