In its latest monthly house price index, theproperty search website said that a burst
of activity in the early months of the year will be followed by post-election uncertainty.
Sales volumes next year are set to remain well down on historic norms. These factors
will leave average prices static with 0% growth in 2010.

Miles Shipside, commercial director at Rightmove, said that some of the characteristics of the recession are likely to remain for many years to come, as the market has fundamentally changed since August 2007.

He added: “This means a fall in owner occupation, with fewer first-time buyers, more time between trading up and a greater reliance on the rented sector to satisfy housing demand.”

Jonathan Cornell, head of communications at First Action Finance, said asking prices and transaction levels would not rise until the supply of mortgage funding and the
availability of credit improved.

He added: “Economic fundamentals simply do not support sustained price increases.
While there are positive signs in the market with predicted increases in the supply of
mortgage funding and gross lending, there will be a lot of uncertainty about 2010 as
there is an election and the possible removal of the massive monetary stimulus.”

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Richard Morea, technical manager at London & Country, added that fears about
unemployment would slow down any increase in asking prices.

He explained: “Uncertainty over jobs will encourage people to put off any move until they have a more settled outlook and feel more confident over their employment situation. The pre-Budget report announcement that the Stamp Duty holiday will not be extended might also put a slowdown on first-time-buyers.”