A report published recently by Ernst & Young ITEM Club has predicted that at the start of next year (2010), residential property prices will again fall as the market experiences a double-dip despite current house indices indicating slight price increases.

It believes that it will take until 2014 for property prices to return to the peak level they were at in 2007.

It also reports that the recent rises are more to do with the lack of availability of stock and the small number of cash-rich buyers. First time buyers are also not returning in significant numbers due to the high deposits required by lenders and the limited choice of mortgages available.

Hetal Mehta, an ITEM advisor, said: “A small number of cash-rich buyers have supported prices, but the supply of these funds is limited, which means prices are likely to dip again in the first half of next year.”

However the report also went on to state that it expects prices to rise again towards the end of the year and increase by +2.8%.