PROPERTY prices are set to rise even higher than experts originally predicted - with the region seeing the strongest growth.

Property website Hometrack had expected property in England to increase in price by four per cent in 2004, but it has now doubled its prediction to eight per cent.

Experts say the price rises are due to demand for property outstripping supply.

Prices rose by 0.7 per cent in March as the number of people looking to buy continued to rise.

This price rise follows a jump of 0.9 per cent in February, which now puts the average price of a house in England at £149,800.

This month, the number of properties coming on to the market rose by 4.2 per cent, with 6.4 per cent more people looking to buy - suggesting further strong house prices in the coming months.

John Wriglesworth, Hometrack's housing economist, said: "Low interest rates remain and, despite prospects of rises this year, buyers are not being deterred from borrowing even higher multiples of their incomes to afford their desired homes."

Although growth continued across the country, it was strongest in the North, particularly on North Teesside, with a 1.5 per cent increase, followed by Northumberland and Tyne and Wear, at 1.2 per cent, and North Yorkshire, at 1.1 per cent.

Homes are said to be selling for an average of 96.2 per cent of the asking price and taking just over four weeks to sell.

In the North-East and North Yorkshire, the value of housing stock rose by more than 25 per cent in the past year - the highest rise anywhere in the UK.