Report When Will Northern Ireland Property Prices Stop Falling? in Northern Ireland Posted December 2, 2008 Normal being 10% deposit and 3x salaries?IMO, the banks aren't choosing not to lend, they're being forced not to lend. In the current market it is just too risky for them. It's a bit of a double edged sword though - it they don't lend, their existing LTVs will fall too, increasing their risk. Which is the lesser of two evils? Maybe it's the devil they know, which is why they're not taking on new customers without hefty deposits. The banks will start to lend 'normal' mortgages when prices return to normal again too. I think this is inevitable and no amount of hand wringing will change this. The quicker the prices fall, the quicker they're more likely to return to lending - the prices are simply too high and are falling too quickly to warrant mortgages with small deposits. No small deposits, no buyers until they have saved. It's all a vicious circle and IMO, won't stop self perpetuating until prices are well below average long term trend. Velocity of falls may decrease, but I have little doubt that prices have a long way to fall yet. I new average price was recorded by Nationwide, I think it was in November, of aprox £160k. Obviously a lot of houses, that are still on the market have a long way to fall to meet that new average. Will that average continue to fall? Very likely, but at a much slower rate and may even rise for a quarter and then fall again as the samples are low. I have said before - the fact that the banks are now the largest owners of development land and partly developed sites in NI will bring a new factor to proceedings. They can't sit back and just let the dust settle. At some stage, I hope months, you hope years, they will have to call it and move. Thats a big factor that hasn't been discussed.