Summary: House prices will bottom out - Particular areas will begin to see sales pick up - Interest rates likely to fall further in the first quarter - Estate agents in ‘make or break' year.
Chief executive Peter Bolton King said that three things needed to happen to start the recovery.
Firstly, major lenders must begin to make money available to potential buyers. Secondly, cuts in interest rates must be passed on to the market and lastly, consumers must begin to recover confidence in the state of the housing market.
After 12 months of gloom, Mr Bolton King said that 2009 is likely to be the year the recovery begins. Interest rates are likely to fall further, particularly in the first quarter of the year and the fall in house prices will begin to bottom out.
Mr Bolton King said that, in some markets, the bounce back could be as dramatic as the fall.
He said: "Officially house prices have come down since their peak by around 13 per cent - but speaking to members it seems clear that in some areas at least prices have come down by more than 20 per cent.
"We haven't seen that kind of fall, in such a short period of time, ever before. However it is also clear that parts of the market are perhaps beginning to bottom out, and it seems possible to me that once the recovery begins, we could see a bounce as pronounced as the fall.
"Some people are beginning to cotton on to this - which is why our members are starting to see enquiries increase again, as people begin to believe they can find a bargain."
However if banks and Government do not make a major effort to increase the availability of mortgages to potential buyers, Mr Bolton King warned of a grim 2009 for the market.
He said: "For many estate agents, like so many industries in this economic climate, 2009 will be make or break.
"If things do not improve, then the market could stagnate - and that will have dire implications not only for the thousands of people employed in the profession, but for the economy as a whole."
