The Council of Mortgage Lenders (CML) has revised up its forecasts for housing market activity for 2006 and 2007, saying it now expects house prices to end this year 7% higher than at the start up from 2% in February.
Next year, the forecast for house price inflation has been raised from 2% to 3%. But, at the same time, the CML has also upped its forecast on the level of interest rates and the extent of repossessions. The strength of the housing market is one of the reasons the CML now expects interest rates to end both 2006 and 2007 at 4.75% rather than the 4.5% previously forecast. And this may also mean higher forecasts for arrears and possessions. The CML now foresees 130,000 rather than 120,000 mortgages in arrears of over three months by the end of 2007, and 15,000 repossessions in both 2006 an...
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