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As Housing Today went to press, the NHF's board was due to vote on which bank would be used to purchase the premises in Holborn, central London. The contenders are Royal Bank of Scotland, Bank of Scotland, and Barclays.

NHF chief executive Jim Coulter said: "The existing property, half of which we own, is inadequate and we urgently need extra conference and facilities space."

The NHF will borrow £12m and sell its old office to fund the move – slated for April next year.

It had earlier pulled out of a potential deal in the King's Cross area of London when it realised that falling property prices meant it could afford a better location.

The move follows the publication of the NHF's annual accounts to the year ending 31 March 2003, in which it posted a £1.369m surplus – a more than 23-fold increase from its 2002 turnover of £56,000.

The results mark an even more substantial turnaround since two years ago, when the federation posted a £262,000 deficit and had to implement an emergency recovery programme to salvage the business.

Ian Bate, federation head of finance, said the dramatic increase was largely due to a VAT repayment from the Inland Revenue of £1.358m. "We found we had been overpaying VAT on our conference income and expenditure, so took action to claim this back as far as we could. This took us up until 1992," he said.

The NHF also increased its operating turnover to £200,000, up from a target of only £12,000 at the start of the year. Bate said an improvement in business services and a more robust pricing policy were behind the change.