A poll of 36 analysts at banks, investment firms and consultancies, carried out by Reuters, concludes that average prices will decline a further 14% this year, despite interest rates remaining at historic lows, and will probably lose another 4% in 2010.

Average prices fell by 18% in 2008.

Twenty-three of the 34 polled believe it will be at least a year before prices stabilise.

"We see weak activity in the short term and with concerns in the market this will continue the downward price momentum," said David Page at Investec.

"We are seeing some increase in pipeline demand, buyers are becoming interested in ... houses and affordability is driving that while interest rates are dramatically lower," he continued.

A key measure of the affordability of property is the house price to earnings ratio.

According to Halifax, that ratio fell from a peak of 5.84% in July 2007 (when the average property cost 5.84 times annual average earnings) to an estimated 4.42 in February this year.

The Reuters poll revealed that analysts expect that ratio to fall even further to 4.0, as they believe property is still overvalued.

However, a lack of availability of mortgage funding as lenders tighten their criteria means that few borrowers can secure the finance they need to purchase property.

Repossessions of homes hit a 12-year high last year, with 40,000 Britons losing their home, the Council of Mortgage Lenders said last month, adding that they think 75,000 will suffer a similar fate this year.

The Financial Services Authority yesterday warned that 2.5 million homeowners could end the year in negative equity, where the size of their mortgage is greater than the value of their property.