Savills looks half right, at least. The estate agency forecast yesterday that UK house prices would plunge by 25 per cent from their 2007 peak by the end of 2009 before beginning a pretty steep rally in some regions, smashing through record highs and well beyond.

The down bit of the forecast looks not unreasonable. It means house prices still have another 15 per cent or so to slide before finding some kind of equilibrium level.

At that point, values will start to look attractive again. Homes will start to look sufficiently affordable again. And buying will become more rational relative to renting.

The argument that prices will then bounce very strongly, at least in the southern half of the country, looks less convincing. It reckons that prices in the South East, for example, will soar back through their 2007 peaks by 2012 and grow by 79 per cent from their nadir by 2020.

That's an abrupt turnaround. It would certainly require an end to the paralysis in the mortgage market, the key factor braking transactions. According to Savills, the credit crunch will end in 2010 and lenders will return to “more typical” behaviour at that point.

This may be wishful thinking. The message from every home lender is that the extremely lax standards pertaining before last summer are never going to return.

Lenders are permanently going to require larger deposits, permanently going to lend smaller multiples of income, permanently going to price in fatter margins. Well, at least for the next generation, until bankers' memories of their mistakes have faded.

Mortgages will remain expensive and hard to come by, especially for those with small deposits. Don't be fooled by Skipton Building Society's risible claim yesterday that it was offering 95 per cent mortgages again.

It will consider lending 95 per cent of a home's value, but only if the borrower puts 20 cent of the value into a ring-fenced savings account. For 95 per cent then, read 75 per cent.

If anything, banks' liquidity position is going to get worse, not better. The European Central Bank decided this week to make it harder for European banks, including British ones, to tap into its generous pool of short-term liquidity.

And the Bank of England seems determined to close its own Special Liquidity Scheme, another pool of reliable liquidity, next month.

Tighter, pricier money is going to be a feature of the financial landscape for much longer than estate agents would wish.

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