NAEA forecast sees prices house holding steady

The National Association of Estate Agents (NAEA) is bucking the trend with a less than gloomy forecast for the UK housing market.

The association believes that prices will hold steady in 2008 because basic supply and demand factors will dominate the market.

However, the NAEA acknowledges that the movement of the market is even more difficult to predict than usual, and points out that the credit squeeze, the run on Northern Rock, interest rate rises and the launch of home information packs have all played their part in clouding judgement in the second-half of this year.

NAEA chief executive, Peter Bolton King, comments: “At a very basic level, if supply is limited and demand is high then prices will remain stable or rise … we know that supply is a problem for the UK, a fact highlighted by the government recently as it revised its house building targets upwards.”

Both the population and the number of single person households are rising in the UK and while 2008 is expected to follow 2007 with its marked regional variations for house prices, the NAEA believes prices will remain static overall.

Demand in London and the South East is expected to remain strong whereas areas of lower employment could see prices plateau or even fall.

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