Mortgage lenders, brokers, estate agents and valuers agree that property prices will slow dramatically in 2008 – and, in some regions, fall. But none is predicting a crash in the residential or buy-to-let markets.

Halifax and Nationwide expect prices to remain flat next year. Halifax recorded a 1.1 per cent fall in November. Martin Ellis, chief economist, says this shows that higher interest rates, higher mortgage repayments and falling earnings are putting pressure on household income.