More than six in 10 economists believe 2009 will be a year in which to avoid buying property, with prices falling into 2010.

This still leaves a significant minority who think that prices will be close to their nadir towards the end of this year as the recession and credit constraints ease.

Economists are divided on whether falling prices will depress the economy further or are a symptom of more general weakness.

But a majority think the poor state of the housing market will add to the wider gloom in 2009, not least because housing construction, durable goods sales and services related to housing transactions are such a large part of the economy.

The overriding feeling among the panel is that house prices are still too high compared with incomes and credit conditions.

Financial Times