The centre for economics and business research (cebr), expects the housing market to "remain buoyant through the first half of 2006".

The centre for economics and business research (cebr), expects the housing market to "remain buoyant through the first half of 2006".

Its quarterly housing forecast, published yesterday, predicts that house prices will rise 4.4 per cent this year.

The independent economic thinktank also believes that annual house price inflation will slow to 4.4 per cent this year, from 5.1 per cent in 2005.

Although the group said it expected growth to slow in 2007 as a result of a weakening US housing market, it suggested that house prices in the long-term would be supported as demand outstrips supply.

Mark Pragnell, one of the report's authors, said: "For years now, too many commentators have been writing obituaries for the United Kingdom housing market - but it is quite clear there is still a lot of life left in residential property."

Halifax, the UK's biggest mortgage lender, and Nationwide, predict that house prices will rise by three per cent in 2006.