Nationwide Building Society has predicted that the annual house price inflation rate could drop from it's current 9.7% to 0% next year as the housing market undergoes a 'significant slowdown'.
Lack of available properties and the hopefully anticipated rate cuts could provide some support to prices it further added.
But the effects will be very regional. The Building Society predicted overall a drop of 5% in Northern Ireland against a claim of 4% in Scotland. Scotland does the best as house prices are lowest there - the average first time buyer's property costing just 4 times annual wage, whereas increases of 40% in the third quarter have made Northern Ireland the least affordable area of the UK, with first time buyers houses costing 8 times annual wage.
Fionnuala Earley, Nationwide's chief economist, said: 'House prices recorded another strong year in 2007, underpinned by significant economic momentum, ongoing housing shortages and strong buy-to-let demand. That being said, momentum is now fading, and a number of factors suggest that house price inflation will drop from its current rate of 9.7% to 0% by this time next year.
'The main reasons for this more subdued outlook lie on the demand side of the market, where a slowing economy, tighter credit conditions, stretched affordability for first-time buyers and lower house price expectations appear likely to reduce the level of activity.'
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment