It believed while growth will not continue at the same rate as 2006, mainly due to a further interest rate rise in the early part of the year, maintained pressures on demand for housing stock will ensure an upward trend in pricing.
Prices in London and the South East will continue to rise above the national average, as will property in Scotland and Northern Ireland.
David Stubbs, economist at RICS, commented: "The strength of the market this year has been surprising. Indications are the market will retain significant momentum through the first half of 2007 due to solid economic growth and rising employment. Increasing gloom for those trying to get on the property ladder won't have significant impact on the housing market as demand remains strong."
However, it warned repossessions will rise in 2007 as people struggle to afford repayments, but this won’t have a negative impact on prices as it did in the early1990s because of the overall strength of the market.
Michael Brill, director at Baronworth Investment Services, said: “I see the market increasing by four or five per cent next year so 7 per cent is a little high in my book but providing unemployment doesn’t increase, we won’t see another 1990s happen.”
