The coming year is set to bring difficult times for the housing market, financial and property experts suggested.

After many years of growth, most analysts are agreed that the housing market has begun to slow and will continue to do so this year, with Nationwide expecting house prices to stall until at least 2009.

Donna Bradshaw, financial planning strategist at financial advisors IFG Group, told Sky News that she believed house prices would continue to drop in the months to come, predicting that prices would drop by a maximum of ten per cent this year.

Liam Bailey, head of research at estate agency Knight Frank, explained to the Daily Telegraph that "affordability has been stretched to the limit", adding: "The UK housing market is on a knife-edge."

According to the paper, the number of deals being agreed by agents looks set to plummet by 200,000 this year, with one million expected to be put through in 2008.

However, some are more relaxed about what is to come, with Rupert Dickinson, chief executive of residential landlord Grainger, telling the newspaper his firm is "still bullish" about the future.