2007 property price growth to plough on
Published On 14 December 2006
House prices in Britain are expected to increase steadily in 2007, rising between five and eight per cent, the UK's largest mortgage lender has predicted.The Nationwide central forecast for the whole of 2007 is seven per cent.
Nationwide said the volume of demand and shortage of supply from 2006 would push prices up at the start of the year. However, it said affordability problems and less support from "the bank of mum and dad" would squeeze first time buyers out of the market and lead to a cooling off by the end of the year.
House prices would be driven by London and the south-east, Nationwide said, predicting less growth – between three and four per cent – in the north and midlands.
"Momentum gathered in 2006 will flow into the early part of 2007, and this will be supported by a buoyant economy, stable interest rates and a continuing shortage of housing supply," said Nationwide's group economist Fionnuala Earley.
According to the Land Registry, the average property cost £171,709 in November 2006.
