Selling could prove more difficult in 2009

After a year of falling house prices that has seen the UK average drop below £165,000, homeowners will be looking for a recovery in the housing market in the New Year.

This year saw the lowest level of house building in the UK since 1924 but Barclays chief executive John Varley has predicted that things could get worse before they get better.

"Our view was that from the top to the bottom you could see a fall of something like 25 to 30 per cent," he is reported as saying in the Scotsman.

"I suspect were about halfway through that at the moment. I mean that slowdown, the negative house price inflation started in 2007; it is accelerated in 2008.

"Were about halfway through that period. So in other words weve got another ten to 15 per cent to fall between now and the end of next year."

If Mr Varney is correct, the average price of a UK home could dip as low as £140,000 by December 2009.

Those looking for an increase in the value of their property may be left disappointed, but adding a conservatory or roof extension can afford homeowners more living space and boost the worth of the house.