House price inflation is set to drop from 9.7 per cent to 0 per cent by this time next year, according to a report released by Nationwide today.
The inflation drop is blamed on a slower economy, stretched affordability, tighter credit conditions and a lower demand in the buy to let market. Although interest rate cuts and low supply in housing are likely to provide some support it is thought that they will not prevent a significant slowdown
Fionnula Earley, Nationwide’s chief economist, said:” momentum is now fading, and a number of factors suggest that house price inflation will drop from its current rate.”
House prices in Scotland will remain strong and it is thought that inflation will continue. In Northern Ireland there is expected to be a fall from what are currently over inflated house prices. |
