|
7% - that’s the strong December prediction from the Royal Institute of Chartered Surveyors. This is only a small slowdown from this year’s 8% growth. And it is despite three consecutive monthly RICS’ surveys of its members reporting a fall in confidence in the outlook for house sales.
5.5% - a gentle slowing of the market, resulting in this figure is the forecast from Propertyfinder.com)
4% - a more cautious forecast from Hometrack (Hometrack
Based on what?
Each forecast is mostly based on examining the same vital factors, including:
The UK economy: it continues to grow at around 0.6% per quarter, and has done for the last 57 consecutive quarters.
Interest rates: are at their highest level for five years following the last increase, and many buyers are saying that they are simply unable to invest in a new home because of the size of the repayments.
Employment: which keeps rising. The number of people employed rose 56,000 more in the 3 months to September 2006 , compared with the previous quarter, says the Halifax in its November house price index report.
Earnings growth: The ‘real’ growth has slowed and in the September quarter was only 0.3% higher than retail price inflation, says the Halifax report, whereas the difference was 1.7% six months earlier. This affects the next factor.
Household expenditure: the real’ value of earnings and things like the dramatic hike in bills for utilities such as gas and electricity etc will affect how much cash people have to spare.
Housing demand: currently high and expected to continue. It increases along with employment, which is rising. And it is outstripping supply, putting pressure on prices.
Housing supply: see above. Housebuilding is also “insufficient” in every part of the UK, says the RICS housing market forecast report.
While the factors may be the same, expert opinions vary as to how important they consider them to be.
Predictions explained >>
|
