As countries throughout Europe embrace the Euro, consumers in the UK are actually much more confident for prospects for general economic improvements compared to their French and German counterparts, according to a study from the Halifax.

A separate report released by First Direct confirmed the confidence of British consumers, with research that showed 68% of British homeowners to be confident that their property will increase in value over the next 12 months. In spite of difficult economic conditions, confidence is stronger now than it was last July when only 50% of homeowners believed their property would increase in value.

This sentiment was echoed by the Royal Institute of Chartered Surveyors, whose members are forecasting that house prices will rise by 6% in 2002, compared with 10% in 2001. RICS expect the current slowdown in the housing market is expected to continue in the first part of the New Year before the market picks up in early summer in line with the broader economy.

RICS Chief Economist, Milan Khatri, said: "The economy is forecast to pick up in the second half of the year, which will provide support for the housing market. At the same time it is likely that interest rates will rise, providing a restraining effect on housing demand and house price inflation."

The Halifax research, which was undertaken by NOP, also looked beyond house prices, at how people in France, Germany and the UK thought key economic indicators will perform over the next twelve months.

The main findings of the research were:

• Confidence in general economic conditions - Even though the UK will not be part of the Eurozone, the British are the most optimistic about general economic improvements with 63% of the respondents saying that the economy will improve or stay the same. This compares to the French (57%) and the Germans (58%). The Germans are the most pessimistic with 41% thinking the economy will actually get worse compared to French (35%) and the UK (33%).
  
  
• Confidence in maintaining their personal standard of living is high across all three countries - The feelgood factor remains strong across all three countries with 64% of Britons, 54% of the French and 64% of Germans saying that their standard of living will be maintained at broadly the same level. Twice as many people in France and Germany (20%) think that their standard of living will actually get worse than those in the UK (10%).
  
  
• Confidence in job prospects varies - There is a large difference across the three countries regarding job prospects. The Germans are the most optimistic with 61% saying that their job prospects will stay the same, compared to only 42% in France and 41% in the UK.
  
  
• Confidence in borrowing money - The Germans are the least likely to borrow money during 2002 (70% less likely), the British are less likely to but to a lesser degree (51% less likely), whereas the French are more likely to stay with their 2001 behaviour (58% about the same). The most popular reasons for people in France and the UK to borrow money during 2002 are 'to buy a property' (France 38%, UK 31%), to 'buy a car' (France 21%, UK 30%), and 'home improvements' (France 19%, UK 28%).
  
  
• Confidence in interest rates - There is a significant proportion of Germans who think that interest rates will stay the same (41%) during 2002. The picture is less clear in France where 34% think rates will increase and in the UK there is an even greater belief that interest rates will increase (45%).
  
  
• Confidence in inflation - The majority of people in all three countries think that inflation will rise during the coming twelve months with the French being the most pessimistic - 59% of French feel it will increase, compared to 58% of Britons and 54% of Germans.

Commenting on these findings, Mark Hemingway, Head of Media Relations at Halifax, said: "Even though the UK will not be part of the Eurozone, it is the British who are the most optimistic about general economic improvements during 2002. Consumers in the UK, France and Germany have very different views on how they will fare in 2002, but the majority share one common characteristic - they expect that their own standard of living will remain the same during the coming 12 months."