HOUSE prices in Colchester are set to rise by 6 per cent next year, according to estate agents.

Research by the property website Zoopla has revealed the average house price in the town is £236,039, only a 1 per cent increase from December last year. It is the third lowest rise in the country.

However, estate agents believe prices will shoot up in the next 12 months.

John Palmer, managing director of Palmer and Partners, said: “We will see an improvement next year. Prices will rise by about 6 per cent in Colchester.

“It is not a boom, but it is nice and healthy.

“House prices in London are ridiculous so I think we will see people migrating to Colchester and Chelmsford as alternatives because they are cheaper.

“The Help to Buy scheme will also fuel demand.”

Nationally, the average increase in house prices over the past year is 4.4 per cent and 4.7 per cent in the east of England.

House prices in Colchester are still just below the national average of £244,289.

Mr Palmer said London prices had skewed the figures.

He said: “It’s been a good steady market this year. We’ve matched our sales figures from 2008. The last five years have been tough, but we’re back to those levels now.

“New developments help stem the need, but there is still not enough second-hand homes.

“Not everyone wants to buy a new build.”

David Knight, sales manager at Jackson and Co, is also expecting house prices to go up next year.

He said: “We’re almost defintely looking at an increase in prices next year.

“The market has picked up in the past three months. November was fantastic.

“We always know when there is a rise in the market because properties that had had no interest get four of five viewings a week.”

Mr Knight predicted a rise of between 3 and 5 per cent next year. He said: “People are more confident in investment.

“People who were looking to rent are buying with 5 per cent deposits.

“I think it will be very busy next year because there are so many people looking to buy.”

Essex estate agent Haart recorded a 2.7 per cent house price rise.

Paul Smith, chief executive, added: “The property market in Colchester is far more buoyant this year than last, in part fuelled by the Help to Buy scheme which means more people can afford a mortgage.

“We’re also achieving around 97 per cent of the asking price for properties.

“It’s a very steady picture, one which will please buyers who are wanting to get on or move up the housing ladder.

“However, because of pent up demand, we could see house prices rising more quickly in months to come so it’s now a very good time to put your house on the market.”