This time last year, as agents and analysts gathered around their spreadsheets and crystal balls, everyone was breathing a sigh of relief. The housing-market crash predicted by the gloomy Jeremiahs had not come to pass. What’s more, at the tail end of 2006, prices in some areas had even begun to turn upwards. The boom years were back on track.

Twelve turbulent months on, the picture is very different: buyers, builders, sellers and speculators are all holding their breath. Nobody doubts any more that we have entered a slowdown, but just how long will it last, and how low will it go? What will happen next year to the value of your home — be it a Georgian rectory with a couple of acres, a suburban Victorian terrace or a city-centre buy-to-let investment? And what will happen to the price of the property you are looking to buy?

These are the questions that Emma Sweeting and Dan Hull, like every homeowner, would like the answers to. Sweeting, a copywriter, and Hull, a business analyst, both 30, married in August, and each owns property: Sweeting a studio flat in Harpenden, Hertfordshire; Hull a half-share of a two-bedroom house in Penge, southeast London. Together, they are looking to buy a two-bedroom cottage in Hertfordshire or Bath.

It is not proving easy, however: Sweeting’s studio went on sale for £139,950 in spring, and was snapped up quickly, but the sale fell through after lengthy delays from solicitors on both sides. As the market slowed and swung in favour of the buyer, a second offer fell through at the end of the summer, preventing the couple from putting in any offers on a new home.

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BACKGROUND

• Housing market analysis: the plight of first-time buyers

• Home economics - January's shock house price stats

• Home economics - the property market

• The harder they fall

• Home economics

BACKGROUND

• Wise up to size

• The property market: October 21, 2007

• Shires fall to foreign land rush

• House price gloom as the wealthy turn away

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The market is cooling. But learn the rules and it could work to your advantage

• Why won't my house sell?

BACKGROUND

• Empty homes: the mystery of the UK’s million vacant homes

• Opening bids: Why the Government must do something about Britain’s empty properties

• It’s dire in the shires

• Cash in on your biggest asset

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BACKGROUND

• Misery for over-extended and over-indebted

• UK house market is ‘heading for crash’

• The property market: October 14, 2007

• Held to ransom

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Their experience with the studio — culminating in their current inability to sell — reflects the broader fortunes of the market in the past 12 months. The year began with rising prices in London and the southeast, forced up by low supply and huge demand, which was in turn fuelled by City bonuses. Prices rose by 23% in the 12 months to September 2007 in Kensington and Chelsea, according to the Halifax, Britain’s largest mortgage-lender, by 35% in Winchester and by 36% in Rock, Cornwall’s expensive holiday-home hot spot.

Yet not everywhere experienced this boom. The same Halifax index shows no growth in Burgess Hill, West Sussex, a 2% fall in King’s Lynn, Norfolk, and a 3% drop in Dudley, in the West Midlands.

The outlook for next year looks similarly patchy. This summer’s sub-prime crisis in America, turmoil in the financial markets and successive interest-rate rises have already begun to take their toll on the housing market, with the latest indices the most pessimistic they have been for years. Even this month’s 0.25% cut in the base rate of interest — with the prospect of more to come — has done little to lift the gloom.

Seven months on, Sweeting’s studio is still for sale. Frost’s (01582 768666, www.frosts.co.uk), the agency marketing it, describes the market as “totally dead”. The clampdown by credit lenders means Hull can’t borrow as much as he’d like for his new mortgage. Because of this, he will be forced to sell the half-share of his house in the capital, something that, earlier in the year, he wouldn’t have needed to do.

This means he now stands to lose his foothold in the London market.

“There are always stories of doom and gloom, but if you can find the right house and the right fixed-rate mortgage, then there's no reason not to buy,” Hull says. “For sure, it’s a worry, but there’s always going to be some risk involved.” So, just what will the risk be in the coming 12 months? Will the gathering clouds burst into the “perfect storm” predicted by the more bearish economists, or will they fizzle out in the damp drizzle the agents are hoping for?

“The market is the weakest it has been for a decade,” says Martin Ellis, chief economist at the Halifax, which earlier this month reported that prices have fallen for three months in a row for the first time since 1995. It predicts 0% growth during the next year.

“The slowdown is a flattening-off, but nothing more dramatic than that,” Ellis says. “The market will remain subdued throughout 2008, but interest rate cuts will help underpin confidence. It is not like the late 1980s and early 1990s, when owners were forced into selling. There is more caution

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