Investors & first home buyers are expected to drive up house prices by 5% in 2011

INVESTORS and first home buyers are expected to drive up house prices by around five per cent next year, property analysts say. While residential property prices remained relatively flat in the last quarter of 2010, a tight rental market and return to “normal” trends in first home ownership are likely to lead to firm growth late next year, they say.

CommSec economist Savanth Sebastian said increasing rental demand and rising wages would help fuel steady growth in house prices. He said demand would be subdued in the first half of 2011 before accelerating in the last two quarters.

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