House prices look set to increase by nine per cent next year, mortgage lender Nation-wide said.
But the building society said it expected most of the growth to come in the first half of 2004, before rising interest rates and weaker income growth dampen con- fidence.
Alex Bannister, Nationwide's group economist, said: "The housing market will carry considerable momentum into early 2004 and we expect house price growth to be biased towards towards the first part of the year.
"Later rising mortgage rates and slow income growth will dampen confidence.
"House price expectations are also likely to become more realistic, especially in the north ."
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