House price predictions favour slow growth

by Gill Montia

An abundance of predictions for the 2008 housing market have left most homeowners confused because they range from expectations of a single digit increase, to a housing market crash.

Taking an overview, Capital Economics, the economic forecasting consultancy, is anticipating price falls of 3% during both 2008 and 2009.

This position is supported by latest figures from Hometrack, the property website, which show a 0.1% decrease in prices during October.

However, Nationwide reported that house prices rose by 1.1% during the month, whilst pointing out that “underlying market activity is clearly slowing.”

Nationwide will publish its official house price forecast for 2008 this month but Fionnuala Earley, the society’s chief economist, expects price growth to be broadly flat during the year.

The Council of Mortgage Lenders puts a figure of 1% on a 2008 rise, given that a continuing shortage of property will help underpin values.

http://www.financemarkets.co.uk/2007/11/05/house-price-predictions-favour-slow-growth/

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