You can no longer ignore the housing slowdown. It is happening, it is serious, and it is likely to get worse.

Nationwide said today that house prices fell in November by 0.8 per cent, the sharpest drop in 12 years.

That could be one month's random volatile data, of course. But consider this: all the surveys - Rightmove, RICS, Halifax, Hometrack and now Nationwide, have reported price falls over the past two months.

Today, the Governor of the Bank of England is explicitly warning on the risks to the housing market from the credit crisis, and he weighs his words on property more carefully than anyone.

Other experts agree. Kate Barker, the Government's top housing guru, believes that the market hinges on confidence and could turn down very sharply if the arithmetic of buy-to-let gets worse (and it has done). HSBC said yesterday that their models implied house prices were 30 per cent above true value.

Rarely has it been the case that every indicator or authority you care to consult on the property market has pointed in the same direction.

Everyone in Britain has a stake in what happens next. Any fall in prices would effectively redistribute cash from those who have invested in property in recent years to those who, willingly or unwillingly, did not do so. And no one wants to see a messy crash.

The dynamics of the past few years could go into reverse. For years, those who have simply owned their own home have watched as its price has gone up - and so has everyone else's, meaning that in reality, they are no better or worse off. Likewise, they will be fairly unsinged by a fall in prices, providing they have no pressing need to sell.

These "long-term investors" will be able to sit out the market's ups and downs much more comfortably than those who in recent years have treated the market as a business opportunity and stretched their borrowing to do so.

So what to do?

Those outside the market would be wise to do what they are now good at: sitting and waiting, because for the first time in many years, that tactic might finally be about to pay off.

Those who have built up mini-property empires should think carefully. Any plans that rely on household equity rising to offset shortfalls in mortgage repayments are simply no longer sustainable.

Explore Economics

• Pre-Budget Report 2008

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• World Economic Forum

• The Times MPC

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