Property giant Savills today confirmed the worst fears of the market - things keep getting worse.

The firm issued its second profits warning in three months and chief executive Jeremy Helsby warned that the bottom of the market was becoming increasingly hard to call.

Savills shares tumbled 33p to 217p or 13%, having traded at 700p last year.

"We now expect our underlying profit before tax for 2008 to be significantly below the current range of analyst forecasts," the firm said in a grim statement to the stock market.

Analysts slashed forecasts to around £32 million. Savills reported profits of £85 million last year.

Helsby said that while conditions in the UK have not deteriorated any further since October and the fallout from the collapse of Lehman Brothers, sales of homes and offices in Europe and the US have fallen off a cliff. The mortgage business is still struggling as banks continue to ration lending, he added.

Savills said it will "consider its dividend policy in light of the full-year result for 2008 and trading in the early part of 2009" - an ominous sign for investors who have already had their fingers burned in the property crash.

Helsby said: "Things have taken another turn for the worse. In Europe it got worse in November and December, while in the UK things are similar. The question is when the bottom of the market is going to be and we keep pushing that time period out. We now thing it will be some time in the second or third quarter of next year as opposed to the first.

"At some point next year there will be a time when sellers decide they have to sell and buyers will start to buy. But at the moment it is very difficult and expensive to find debt."

Helsby added that while the commercial property market remained stale, the "green shoots" of recovery were starting to emerge in the London housing market with visitor numbers up, even if sales were not.