Property prices set for 5% rise in 2008

Posted: 30 Oct 2007 10:15:13 GMT

Property prices will rise at a greater rate than that predicted by the Council of Mortgage Lenders (CML), according to one expert.

Property prices will rise at a greater rate than that predicted by the Council of Mortgage Lenders (CML), according to one expert.

Assetz says that it expects price inflation to hit five per cent in 2008, well above the CML forecast of just one per cent.

It would still be a slight downturn on the expected seven per cent growth in 2007 but the firm says that the market remains strong and things are beginning to improve following a few weeks of turmoil.

"To suggest that house prices will rise just one per cent in 2008 represents an overly cautious approach from the CML," said Stuart Law, chief executive of the firm.

"With an anticipated period of lower interest rates and the credit crunch now receding, I would predict a more realistic house price increase of five per cent in 2008, given the continuing supply/demand imbalance.

"While I would agree with the CML that sales volumes are likely to fall next year, I do not expect this to have a significant impact on price. With fewer sellers than buyers expected in the market, this will in fact support prices, keeping them buoyant," he added.

Yesterday (October 29th), Your Move published its house price figures for October, putting month-on-month inflation at 1.2 per cent.

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