Wednesday, 20 June 2012 1:11 PM
Homeowners will have to wait until at least 2014 before they see their properties rise in value, according to a poll of 20 market watchers, by Reuters.
The news agency says their consensus view is that prices will fall another 1.6 per cent this year and remain flat in 2013.
That is a more pessimistic view than in the last Reuters poll in which they said prices would fall two per cent this year but rise 1.9 per cent in 2013.
Most recent house price indices have suggested that prices are static or falling gently. Transactions remain stuck at a historically low level along with mortgage interest rates.
Looking to the longer term, the market watchers think British house prices are still over-valued according to economic fundamentals. They marked the British market six on a 10-point scale where one is very under-valued and 10 very over-valued.
Melanie Bowler of ratings agency Moody's Analytics told Reuters: "Some further downtick in property prices is expected this year amid weak demand and tight credit. However, a degree of undersupply in the market will prevent sustained sharp price declines."
The poll also confirmed recent survey evidence that London is out-stripping the rest of the country.
Peter Dixon of Commerzbank said: “We appear to have a two-speed market in which London performs well whilst more distant regions are less buoyant.”
Overall, 12 out of the 21 market watchers questioned expect further price falls and most do not expect the market to stabilise until next year.