'House price growth to reach 7% in 2007'

12-Dec-2006

First time buyers will continue to struggle against rising house prices throughout 2007, experts warn.

According to data published by the Royal Institution of Chartered Surveyors (Rics), first time buyers will continue to see house prices rise throughout 2007, at a rate of around seven per cent.

While Rics believes that an interest rate rise to 5.25 per cent is likely during the first few months of next year, it is not expected to push house prices downwards.

"Indications are the market will retain significant momentum through the first half of 2007 due to solid economic growth and rising employment," said David Stubbs, an economist at Rics.

"The bleak outlook for first time buyers looks set to darken further as house prices rise faster than incomes," he added.

However, following a recent Bank of England report estimating that nearly eight per cent of homeowners are struggling to meet mortgage payments, Rics expects the number of repossessions to increase further over 2007.

First time buyers dismayed by another increase in property prices should seek out those companies setting up to help them find bargains.

For advice on first time buyer mortgages or to find out how much you can borrow and how much it would cost you, contact a good mortgage broker.

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