Date Published 21 August 2014
Statistics collated by the government show that independent international economists predict stronger-than-expected UK house price rises over the next five years.
Each month the Treasury pulls together what it calls City and Non-City forecasts across a range of economic indicators. This month it has looked at forecasts for house price rises between now and the end of 2018.
While short-term analysts suggest a recent slowdown in price growth - and in some cases outright price falls - may herald a slump, economists appear far more optimistic.
The City commentators are Barclays Capital, Capital Economics, Citigroup, Commerzbank, Goldman Sachs, ING, Nomura and RBS Global.
They forecast rises in 2014 of between 5.8 per cent and 12 per cent. In 2015 the predicted increase will be 6.0 to 16.5 per cent. In 2016 the increase will be 4.6 to 10.1 per cent.
In 2017 they anticipate 0.5 to 5.6 per cent, and in 2018 the prediction is 1.7 to 5.0 per cent.
The group of so-called Non-City commentators include many household names in terms of management and economic consultancies. They are Beacon Economic Forecasting, Cambridge Econometrics, CEBR, EIU, Experian, IHS Global Insight, the IMF, Liverpool Macro Research, the NIESR, Oxford Economics and PwC.
Their forecasts broadly mirror those of the City commentators.
As always with house price forecasts, there must be numerous health warnings.
Firstly these are purely forecasts, and have less reliability the further they look into the future, due to unforeseen events. Secondly they are averages and so exclude, obviously, regional variations. Thirdly they do not take into account general inflation and how that may erode the apparent house price growth.
Nonetheless, this data is part of the information assessed each month by members of the Bank of England Monetary Policy Committee when they decide whether to change base rate.
