Property prices in the UK could be set for a period of fluctuation as opposed to a crash, according to experts at the centre for economics and business research (cebr).
Continual increases in property prices have led to some fears of a crash in the market in the near future, with many people believing that the market cannot sustain these price rises in the mid to long term.
However, the cebr maintains that the market is on its way to a period of readjustment and fluctuating prices over time, rather than a crash.
Chief executive Douglas McWilliams argues that favourable interest rate conditions have helped fuel property price increases, in turn keeping the market buoyant, if a little unsteady.
"A property crash is fairly unlikely, but we do think that the big gains in property have already been made and from now on property prices will fluctuate, more in line with earnings inflation," commented Mr McWilliams.
"There will be no more of these ten to 20 per cent rises, which we have had a lot of over the past ten years. I think those kind of rises are probably over," he added.
Earlier this month research from Thomas Charles was published indicating that nearly a quarter of the population is anticipating a housing market crash within the next 18 months. These fears have been fuelled by rising debt levels and relatively high interest rates.
Reports from the Royal Institution of Chartered Surveyors and Halifax predict that house prices will rise by no more than seven per cent in 2007.
Source: Adfero / London Stock Exchange
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