Prices will drop by up to ten percent over the next year, according to mortgage intermediaries.
The British mortgage market will slow further over the next year, the Intermediary Mortgage Lenders Association (IMLA) said today.
According to the poll of lenders, more people think that house prices will fall (47 percent) than remain stable (43 percent). An average predicted mortgage volume drop of six per cent was also forecast by IMLA members. Business levels for intermediary lenders were predicted to either remain flat or suffer a fall of up to ten percent.
However, these results were more positive than those released by IMLA earlier this year, in which a majority of members predicted further house price falls. Moreover, IMLA members in the financial heartland of the south east were also more positive in the latest set of results than other regions: just 44 percent predicted further declines in property value.
Peter Williams, executive director of IMLA, commented: "The findings of the survey show intermediaries as realistic but not unduly disheartened. They recognise that mortgage volumes will be lower in the year ahead than they have been in the past and that they need to adjust their business models accordingly."
He added: "House prices are expected to see a modest correction, but in the absence of forced sellers in the market place, they do not anticipate a major collapse in property values. These more positive perceptions contrast with the more negative commentary that currently dominates the market and reflects the fact these are locality based views."
