HOUSE prices in this area rose by an average 35.26 per cent over 2002, latest data reveals.

Estate agents Goadsby & Harding Residential sold a record £437 million worth of residential property over 2002.

The agent sold 2,262 residential properties from the firm's branches which cover the conurbation and surrounding area as far Wimborne, Ringwood, Fordingbridge, Salis-bury, Bridport and Dorchester.

"The average price at the start of the year was £155,250 and by the year end this had risen to £210,000," said Goadsby & Harding chief executive Bruce Read.

"Owners have borrowed more and more."

Property prices are causing concern among first-time buyers unable to get a foot on the ladder and existing owners who fear a crash and negative equity.

Analysts are split in their forecasts as to property prices will merely slow in their rate of growth, flatten out or fall.

"Our crystal ball for next year is probably as fuzzy as anyone's. Even the governor of the Bank of England recently admitted he had little idea of where house prices would go," said Mr Read.

"It seems to us that price increases of this magnitude are unsustainable as the housing market becomes ever more out of kilter with the rest of the economy.

"Clearly, the longer the boom continues the greater the correction will be, at some point in the future.

"Interest rates remain low and seem unlikely to rise significantly during 2002. There continues to be a severe shortage of new development coming on stream.

"So our best guess is that prices will moderate significantly but the trend is likely to remain upwards."