House prices expected to reach record highs in 2014
House prices will reach record highs next year above levels they were at the peak of the pre-financial crisis, according to a report.
Experts predict that in 2014 a typical house in the UK will be valued at £223,000.
This would mean that house prices would be 0.7 per cent higher than their 2007 peak.
The Centre for Economics and Business Research (CEBR) also estimates that house prices will rise by almost 20 per cent by 2018.
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The CEBR said initiatives such as the Funding for Lending Scheme (FLS) would support a revival of the property market in the UK. It added the FLS would help to raise the number of mortgage approvals and work to keep lenders offering cheap mortgages which will help more people to be able to afford to buy their first property and increase demand which should help house prices go up.
It also expects the Bank of England's quantitative easing programme to be increased by a further £75 billion to reach £450 billion by late 2013 and that this will support increased mortgage lending and raise property prices.
By 2018, house prices will have risen by 19.1 per cent to reach an average of £261,000, it added.
CEBR economist Daniel Solomon said: "UK property prices will be driven to pass their pre-crisis peak for the first time by fundamentals such as a return to modest economic growth and restricted housing supply increases."
Meanwhile, the latest Knight Frank/Markit House Price Sentiment Index reveals that households in eight of the 11 regions in the UK expect the value of their property to increase in 2013.