House prices in Britain are set to fall by an average of 10 per cent next year, according to forecasters, with some experts expecting the decline to bottom out after summer.

Daniel Thomas, Property Correspondent, FT.com – 29 Dec 2008

There is a wide disparity between the most optimistic forecasts – that the market will remain flat – and the most bearish predictions of a further 20 per cent fall in house prices.

The only consensus among the forecasts is that there will be no growth in the market next year. Such is the level of uncertainty, given the precarious state of the economy, that Halifax and Nationwide, two of the largest mortgage lenders, have decided not to release house price forecasts for next year.

Nationwide said it could be irresponsible to make a forecast, given the market’s dependence on confidence. Halifax said its decision related to its merger with Lloyds TSB. Both forecast at the start of this year that the market would be flat – it fell by 14-15 per cent in the year to the end of November, according to the lenders’ own indices.

Other forecasts reveal a range of 20-35 per cent in peak-to-trough falls in the housing market. Full Article