Estate agents are debating among themselves whether it will soon be appropriate to shave 25% or 30% off the values of properties in England from when prices peaked at the end of 2007.

Savills valuation department yesterday admitted that valuers were having a hard time assessing the ‘reality’ of the current market, where there is little transactional evidence; where prices are falling and the market changing almost daily with wave after wave of bad news in the media.

Properties worth over £500,000 – an increasingly hard line to draw as the goalposts move – are said, however, to be ‘holding up better’ but turnover of property sales in England is down by 60%.

So far this year, Savills believe prices to have fallen around 10% but they warn more is to come.

Markets which are most exposed to the fall out from City job losses – Kensington, Notting Hill, the City and Wapping – are particularly vulnerable. In the first half of 2008, the only market bracket to have had stronger turnover than last year was the super prime. In the £20m bracket, ‘both turnover and prices are holding up but it is thinning,’ says Jim Ward, director of residential research.

‘We are now standing back from saying the recovery will come in 2010,’ he adds. They predict that December 2007 values are unlikely to be seen again until 2012 – 2016.

However, as the glut in the supply of new housing continues, Savills anticipates that the recovery, when it comes, will be swiftly boosted by housing scarcity.