Average house price 'to more than double in 20 years'

The UK will see average house prices more than double by 2025, the Centre for Economic and Business Research (CEBR) has suggested, with prices set to rise even further if the government does not manage to meet its ambitious housebuilding targets.

The price of a typical home will rise to £460,000 by 2025, the CEBR has said, basing its findings on long-term house price inflation expectations.

Even a forecasted slowdown in 2008 and 2009 will not prevent the average price from rising to £209,000 come the turn of the decade, the report noted., though the CEBR has advised householders to nonetheless prepare for a cooling in the market.

'Our forecasts, which point to a further rise in interest rates to six per cent by the end of this year, suggest that the impact of the recent rate hikes is starting to take effect and that homeowners will have to adjust to significantly lower rates of price growth over the coming years," advised CEBR economist Jaspreet Sehmi.

House price growth in July was just 0.1 per cent, according to recent indices from both Nationwide and Halifax.


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