Insurance News Archive

House prices set to continue growth in 2007

House price inflation is set to continue on an upward curve in 2007, Nationwide has predicted.

According to the group, house prices are set to grow by between five and eight per cent in the next 12 months, on the back of strong market growth in December.

Nationwide's figures show that house prices increased by 1.2 per cent this month, bringing annual growth to 10.5 per cent.

This means that yearly growth has returned to double digit figures for the first time since February 2005.

Moving into 2007, Fionnuala Earley, Nationwide's group economist, said that "a buoyant economy, stable interest rates and a continuing shortage of housing supply" would lead to double-digit annual growth early in the New Year.

"However, increasingly poor affordability, the impact of higher mortgage rates and the likelihood that fewer parents will be willing or able to help their children out will cause the rate of house price growth to move into single digits in the latter part of the year," Ms Earley said.

28 Dec 2006