Tradition updates on future house price predictions

  Financial services group Tradition’s future house price index is predicting UK house prices to climb 7.5% in the next three years to £177,837.   The figure is down slightly from the 8% rise predicted for the same period last month.   The index, which predicts future house prices based on the residential property derivative market, predicts house prices will rise 13% to reach an average of £186, 936 in five years’ time.   Tradition director of real estate Peter Sceats said: “Physical house prices in the UK have continued to increase despite worries that unemployment, restrictive lending and an increase in taxation would prevent recovery.   “According to the Tradition future house price index, the forward prices are still showing willingness to climb as shown by the move in the five-year house price during October.   “Some traders are focusing heavily on the core fundamental of supply and demand and believe the rate at which new homes are being (and have been) built is severely insufficient for the UK’s future housing needs.   “As such, forward house prices currently have distinctly different short-, medium- and long-term profiles.”   nathan.cross@estatesgazette.com