Richard Donnell Prices Quotations

London continues to be the engine for national house price growth. In the short term, prices in London are likely to be supported by an ongoing shortage of housing for sale.

Whilst activity levels may have improved over the autumn of 2005 on the back of more realistic pricing, it does not automatically follow that prices will start to rise.

The pick up in activity levels and prices over the final quarter has created optimism that values will continue to rise slowly over the year ahead. The recovery in London is set to continue and spread to the Southeast over the year.

Prices are likely to continue to rise over the next month or so as a result of buyers returning to the market and supply remaining limited.

A resurgent market in London, where prices grew by 1.1 percent, has put something of a gloss on the headline results.

The current level of growth is unsustainable over the longer term as house prices in the capital still remain relatively high.