House price recovery may take years

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The gloomy message was delivered by more than 60% of 225 Society of Business Economists (SBE) members surveyed for ITV1's Tonight programme.

House prices could fall by up to 20% from the top of the market, according to 56% of respondents - although 20% took an even more pessimistic view, forecasting property values could slump by as much as 30%.

More than half the experts from banks, building societies and industry said house prices would fall by between 6% and 10% this year. The market will hit rock-bottom in 2009, according to 44% of those surveyed.

The SBE's chairman, Bronwyn Curtis, also warned recent buyers could have to wait "a long time" to get their money back.

She told the programme: "It doesn't look like we're going to see a fall, which is what we're in the middle of, and a quick bounce back. It does look as though it's going to go on, and we'll have slow growth for some time.

"On top of that, house prices were overvalued, according to most economists, and so you have the situation where they remain undervalued for a long time."

The survey is the latest addition to a steady stream of miserable news on the housing market, which saw share prices in the UK's major housebuilders hammered last week.

Recent figures from the Nationwide and Halifax building societies showed hefty price falls during May, while the number of homes changing hands also slumped to a 30 year low as the credit crunch continued to put pressure on the property market.

Estate agents sold an average of just 17 properties each during the three months to the end of May, according to the Royal Institution of Chartered Surveyors - the lowest figure since it first began collecting data in 1978.