Nests to prove no nest egg

HOUSE-BUYING during the Nineties should be for 'nesting not investing', according to a study by accountants Coopers & Lybrand. The forecast predicts that real house prices will fall this year and rise by a modest 2.4 per cent a year from 1994 to 1999.

When compared with a real return of 4 to 4.5 per cent on lower risk financial assets such as index-linked gilts, Coopers says that housing no longer looks so attractive.

The Coopers forecast, along with a forecast from Midland Montagu, the investment bank, suggests that the British economy will show zero growth this year. In a new shift towards gloom, both break with the consensus predicting growth of 0.5 per cent.

Coopers says that zero growth is likely even if the recovery begins in the current quarter, because the starting point in the first quarter is so much lower than the average level last year.