Housing market 'will recover' in 18 months

House prices will return to their peak within 18 months if the market continues to grow at the rate seen in the last two quarters, according to property investment advisors Assetz.

The claim follows a Council of Mortgage Lenders (CML) report released yesterday, which revealed that there was a two per cent increase in mortgage lending in September over August, bringing the total lent last month to £12.5 billion.

Despite the increase CML's figures showed that lending for the third quarter was still down 36 per cent on last year.

Stuart Law, chief executive at Assetz, claimed the current mortgage lending numbers are not as good as they were two years ago because of the reduced availability of low deposit mortgages.

He said the new figures were a "very positive sign" as they showed a modest recovery in mortgage lending.

"If it carries on at the rate we've been seeing for the last six months then prices will be back to their peak [in] 18 months' time," he added.

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