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Average house prices tipped to soar

A think-tank, Policy Exchange, has forecast a large rise in the average price of a UK home over the next quarter of a century.

Policy Exchange has utilised a complicated formula obtained from the authorities, which has led it to suggest that the average home might be worth about £780,000 in the year 2040. If a typical house goes up in value from around £250,000 to almost £800,000 over a 26-year period, some analysts believe it could have far-reaching social consequences.

The think-tank has used its calculation to lobby for a more significant programme of house building. Its experts have suggested that the construction of additional garden cities, on a large scale, could be a policy worth pursuing.

Garden cities seem to be viewed favourably in several political circles, although some believe that translating general backing into actual action might not be a straightforward process. Policy Exchange does not believe that the new cities should be imposed by Whitehall if local people object.

If house prices do increase in value in line with the prediction, there may still be some important geographical variations. Nonetheless, the pressure on householders to get their properties to look their best may grow. An example of an after effect could be increases in the use of wood flooring in North Wales and other parts of the country.

Chris Walker, a planning expert for Policy Exchange, has said:

“Expanding existing cities or building brand new garden cities will play an integral role in meeting future demand.”

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