High cost and uncertainty over interest rates have stopped people buying houses during the past year, according to a survey published yesterday.

The survey found that the high cost of property in their desired area put 31 per cent of people off buying houses, while a further 16 per cent were deterred by uncertainty over interest rates.

Lack of availability and uncertainty over the investment potential of properties were also factors in stopping people from moving or buying houses.

Just 10 per cent of respondents cited uncertainty over stamp duty as an issue.

The survey, by Amárach Consulting for brokers Simply Mortgages, found that over three-quarters of people expected interest rates to rise by between 0.5 per cent and 1 per cent over the next year.

Some 30 per cent of people who took part in the survey said they were "concerned" about future rate rises, as these would force them to cut spending in other areas. However, just 9 per cent of people were "very concerned" about further rate rises, while 28 per cent were not concerned about rate rises.

The study found that interest rate increases have not hit most people's lifestyles, with 49 per cent saying they had been unaffected. Some 43 per cent said they had had to cut back on some spending. Just 8 per cent said that they had to make significant cuts in spending.

A significant number of people believe that house prices will fall over the next year: 35 per cent of respondents said that they expected house prices to fall by 5 per cent over the next 12 months while 22 per cent predicted a fall of between 6 per cent and 10 per cent.

Only 4 per cent of those questioned believed that prices would fall dramatically - by 11 per cent or more - over the next year.

A similar study, carried out by Red C and due to be published in the September issue of Investor magazine, has found that investors believe that falling prices may provide a catalyst to encourage people to buy property. The research revealed that 20 per cent of Irish adults are more likely to invest in property now than they were at the beginning of the year. A key finding was that 17 per cent of these individuals cited falling house prices as a reason for investing.

The study also found that 20 per cent of Irish adults have bought investment properties either in this country or abroad.