CML predicts modest 2004 house price growth
09 January 2004
The Council of Mortgage Lenders has added its voice to those predicting more modest growth for the housing market in 2004 than in the preceding years.
The trade body has issued its predictions, anticipating 8 per cent growth this year, followed by a further easing of the market in 2005, when prices are expected to grow by just 6 per cent.
The 8 per cent headline figure is the same as that predicted by Halifax earlier in the week, and is just one percentage point off the 9 per cent prediction given by Nationwide.
Repossessions are expected to rise this year, the CML suggests, due to interest rate increases and rising unemployment.
And first time buyers will continue to find breaking into the housing market difficult: the CML predicts that they will account for just 29 per cent of sales in 2004.
CML director-general Michael Coogan stated, “We are positive about prospects for the housing market in 2004. We think the risks of a boom and bust are receding, as the market is beginning to show signs of moderating gently.
“We would continue to urge borrowers not to be complacent though, as household debt is at very high levels and interest rates are set to increase this year.”
The CML predicts that total lending in 2004 will rise by 6 per cent, to £286.5 billion.