cebr: House prices to rise 4% in 2006

25 January 2006
House prices will rise more than four percent in the coming year, according to new research.

The centre for economics and business research (cebr) predicts that annual house price inflation will slow down to 4.4 per cent in 2006, from 5.1 per cent last year.

House price growth is forecast to be slower still next year, with prices set to increase 2.8 per cent in 2007, the think tank predicts.

"We expect activity in the housing market to remain buoyant through the first half of 2006 supported by a relatively benign macroeconomic environment," said Jonathan Said, economist at cebr and one of the report's authors.

However, Mr Said added that a slowdown in the US housing market would threaten economic growth around the world in 2007.

Mark Pragnell, another author of the cebr report, said that these predictions do not signal the death of the housing market.

"For years now, too many commentators have been writing obituaries for the United Kingdom housing market – but it is quite clear there is still a lot of life left in residential property.

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