Property market predictions - 2007

The property market is never easy to predict, but we all want to know what 2007 has to bring - what with portents of housing crashes, HIPs chaos and interest rate rises ringing in our ears. We asked property experts Hometrack to share some insider knowledge on what to expect in the year ahead.

1. House prices to rise by 4% over 2007

   Overall house prices will rise by 4%, but regional figures will continue to differ - look out for above average growth in London, Scotland and the South East, and slower movement elsewhere.

2. People moving home less often

   According to Hometrack's Richard Donnell: "The housing market is moving into uncharted territory as we enter a period of low growth and lower turnover, a trend not seen since the 1950s". Homeowners are moving home less often - only every 18 years - and this will have an impact on asking prices in the next 12 months.

3. Interest rate rises

   Expectations of more interest rate rises are likely to affect levels of activity, and an above average rise would lead to lower house price growth. Increases in unemployment also remain a worry going forward.

4. Property 'haves' and 'have-nots' - the gap widens

   The types of household buying property next year will continue to create a two-tier market. Existing homeowners will make up the vast majority of new transactions, along with an increasing number of first time buyers being financially assisted by property owners. The gap will widen between those first time buyers doing it alone, making it more difficult for them to get on the ladder.

5. Supply and demand imbalance

   Lack of adequate new housing will continue to fuel house prices, particularly in London and the South East where the population will continue to rise and outstrip ready supply.

• Review the property market in 2006