Residential property prices have been predicted to rise by an average of +5.7% by October 2010, according to a survey conducted by Zoopla.

It found in the survey that 81% of homeowners believe that property prices will continue to increase in the next six months, which is a +51% rise in expectations inside 12 months. However 9% stated that they expect prices to decrease, whilst 10% expect them to stay where they are and remain relatively flat.

Nicholas Leeming, commercial director of Zoopla, said: “With the bad weather behind us and the recent stamp duty relief introduced for first-time buyers, confidence in the property market has bounced back well. Despite the optimism, significant concerns remain around the supply of mortgages and whilst affordability levels are now higher than at any time in the past few years the lack of mortgage funding, especially for first-time buyers, remains the single biggest threat to a full housing market recovery.”

However, according to 78% of people surveyed, mortgage finance was easier to obtain in March 2010 than it was three months previously.

Zoopla has noted that there is a historically high correlation between the confidence level shown in the survey and market activity approximately three months later. This is particularly indicative as 23% stated that they are waiting to see the outcome of the general election before making any property-related decisions.

The Scots are the most optimistic on the prospects of their local property market as 86% expect house prices in their area to rise in the next six months, this compares to 80% in England and 76% in Wales. The Northern Irish are somewhat less optimistic as only 62% predict house prices will increase in the next six months.