HOUSE prices in York and North Yorkshire are expected to remain buoyant while the market in the south-east stagnates, according to the latest predictions.

The new Housetrack survey found that counties with low property prices were still experiencing a boom, with prices rising the fastest in County Durham and North Yorkshire.

But the cooling down in the market, which started in central and south-west London, has now spread to the most expensive districts of Berkshire and Surrey.

The findings are backed by a team of academics who run Technical Forecasts, linked to Aston University, who say that prices will fall by five per cent in London and the South-East.

But they found that some pockets will buck the trend next year, with house prices rising as much as 13 to 16 per cent in York, Berwick and Northumberland.

Peter Moody, of Hudson Moody Estate Agents, High Petergate, York, said: "My own view is that the market is showing signs of levelling off in York. There are no indications that it will go up or down next year."

Meanwhile, a new survey says economic growth in the Yorkshire region is expected to improve over the next few years.

The economic and property market review, from property advisors GVA Grimley, says growth in Yorkshire and Humberside is expected to have been modest, at just 0.4 per cent, in 2002, but is forecast to rise to 2.2 per cent in 2003 and 2.6 per cent in 2004.

The survey adds that house prices in the region have recorded some of the strongest growth rates in the country during the last 12 months, increasing at an average of 25.3 per cent a year, though price growth is expected to "moderate" over the coming year.

On the residential property market it says: "York city centre accommodation remains in strong demand, boosted by its cultural heritage and historic environment, and regular rail links to London and Leeds, making it an excellent commuter location." Under the regeneration heading it lists the York Central site, the 35-hectare area west of and next to York Station, as one of the "key large-scale projects" in the region.

Updated: 12:42 Monday, December 30, 2002