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BBC News' Jonty Bloom
"This year the normal pause in the housing market hasn't appeared"
 real 28k

Wednesday, 29 December, 1999, 18:04 GMT
No end to housing boom

More houses for sale in 2000


The UK's housing market is still rising strongly as the year draws to a close.

The Property Maze
House prices were up 1% compared to November, and have increased by 13.3% for the year.


houses for sale The average house costs 75,000
The average house is now worth 75,219.

Nationwide's David Parry said improvements in the economy, coupled with further falls in unemployment, should encourage a buoyant housing market in the new year, with the number of house sales expected to rise by 7% to 1.58m.

Unusually, house prices are not slowing down as much as usual in the winter season, although prices increased by even more in the month of November - by 1.6%.

Interest rate fears

The steady increase in house prices is raising fears that the Bank of England will continue to raise interest rates in the New Year. The rate rises so far seem to have had little effect on consumer confidence.

Barclays Bank predicts that base rates will be raised by at least 0.5% to 6.0% next year, with mortgage rates reaching 7.75%.

The boost to house prices is likely to continue, with the UK economy set for a strong recovery into the millennium.

"The UK economy is leaving the old millennium on a high. Far from undergoing a recession during 1999, as many predicted at the start of the year, output will have grown for the eighth consecutive year," said Richard Jeffrey of Charterhouse, adding the current economic framework was "immensely favourable".

Most forecasts suggest, that after growing by 1.8% this year, the economy will grow by around 3% next year - one of its best performances, while unemployment, already at a twenty-year low, drops further.

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See also:
18 Dec 99 |  Your Money
Housing boom '20th century trend'
30 Nov 99 |  Business
House prices rise strongly
17 Dec 99 |  Business
House prices 'buoyant' in 2000
24 Nov 99 |  Business
House prices continue rising

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