ESTATE agents in Bolton have enjoyed a busy year with the housing boom continuing through 2003.

Robert Johnson examines whether prices will continue to rise into 2004, or if the bubble is about to burst.

The year 2003 brought more good news for homeowners -- and bad news for first time buyers trying to get on the property ladder. The Nationwide Building Society said the cost of a home rose by 20 per cent in the North-west last year.

A good terraced house in an area such as Horwich, which would have cost you £38,000 two years ago, will now cost you more than £70,000.

House prices in the North-west have increased so much that Bolton estate agents are convinced the north-south divide is beginning to get narrower. In the South-east, prices increased by just six per cent last year.

Darren Robinson, area manager of Whitegates estate agents, which has offices in Bolton, Westhoughton and Horwich, said: "The north-south divide is closing. It's been an excellent year, we have been so busy that we are planning to open a new office."

Neil Wilkinson, sales manager for Miller Metcalfe, which has offices in Bolton town centre, said his firm had struggled to cope with demand.

"We've had such a busy year. There is now a shortage of properties in Bolton, particularly two-bedroom terraced houses," he said. "We've found that people have been buying these houses to renovate and sell on for a profit."

Nick O'Brien, manager of George Grundy estate agents, which covers the Great Lever and Farnworth areas, said they had opened new offices because business had been so good.

A two-bedroom terraced house in Farnworth, costing between £30,000 and £35,000 a couple of years ago, was now fetching up to £55,000, he said.

It is estimated that the average cost of a two-bedroom terraced house in Bolton today is around £60,000.

That is bad news for first time buyers who are trying to get on the property ladder. Many struggle to get a mortgage that would cover the price of the house and are having to try to find bigger deposits.

The Halifax and the Nationwide Building Society said that last year there had been a dramatic drop in the number of first-time buyers entering the market nationally -- the total falling to 360,000, compared to 521,000 in 2002. Steep price rises were putting home ownership out of the reach of many people.

This alarming drop in first-time buyers is reflected locally.

Mr O'Brien said: "It's a worrying trend. Couples have been spending their maximum budget just to buy a house and get on to the property ladder.

"These people may now be looking to rent instead of buying. This will have a knock-on effect for people who are trying to sell a semi-detached house and move on."

Miller Metcalfe's Mr Wilkinson believes that first-time buyers will also struggle to get on to the property ladder because of the lack of houses on offer.

There were mixed views on what would happen to prices in 2004.

Mr Wilkinson said: "There will still be a demand for houses in Bolton, but the problem will be that there is a shortage of properties in the town. There will simply not be enough houses around."

He warned also that mortgage interest rates could rise. He believed the housing boom in Bolton was coming to an end and house prices would begin to drop.

However, Stephen Giddins, manager of the Bolton branch of Bairstow Eves, expected prices to continue to rise but at a slower rate. He predicted that the biggest jump in prices would come at the lower end of the market.

"I believe prices will continue to go up, but not as dramatically as in 2003," he said. "Bolton is improving as a town and there is a lot of housing available here.

"I do not anticipate much movement in the price of properties in the £500,000 bracket. I think it will be the first time buyer who will be most active this year."

Mr O'Brien, of George Grundy estate agents, believed prices would continue to rise next year despite rising mortgage rates, but the increases would not be at the same rate as in 2003.

"I don't expect there to be a boom and bust culture which we saw in the housing market in the early 1990s," he said.

ESTATE agents in Bolton have enjoyed a busy year with the housing boom continuing through 2003. Robert Johnson examines whether prices will continue to rise in 2004, or if the bubble is about to burst