27 Nov

House price growth of 3.5% in 2008, expert predicts

House price growth of 3.5% in 2008, expert predicts

UK house prices will increase by an average of 3.5 per cent nationwide over 2008, it has been predicted.

The prediction from property search firm County Homesearch refutes Nationwide's prediction that growth will remain static next year, but is in line with estate agents Savills' projection of three per cent growth.

Jonathan Haward, managing director of County Homesearch, said: "I would expect to see moderate growth in 2008, with UK house prices increasing 1.5 per cent by June, finishing on 3.5 per cent by the end of the year.

"This will be led by a significant tightening in lending criteria and reduced bonus spending, which will pour some much needed cold water onto what has been an overheated property market."

Mr Haward also echoed predictions from the Council of Mortgage Lenders that three base rate cuts will be due next year.

Cuts will most likely be seen in the first and second quarters, with a further reduction due later in the year, he said.

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