Rics suggests European house price growth will continue
The European property market defied predictions of deceleration last year, and growth is expected to continue this year, a new report has shown.
The Royal Institution of Chartered Surveyors' (Rics) annual European Housing Review showed that both central and eastern Europe showed high annual inflation in house prices.
Rics suggested that despite the European Central Bank's interest rate rises of 1.5 per cent, lenders had not passed that cost on to consumers, preventing the stagnation of house building seen in the US.
Milan Khatri, chief economist at Rics, said: "Rising income and employment levels have cushioned markets across Europe from rising interest rates, and the prospects for 2007 remain good as many economies have entered the year on a firm note."
Author of the report, Michael Ball, added: "In the main, Europe's housing markets had another strong year. The long predicted soft-landings have yet to materialise, with the European Central Bank interest rate rises having little effect in the Euro-zone so far."
Several countries saw double figure growth, including Spain, which showed house price inflation of ten per cent, and a number of eastern European countries.
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