Hi, I just joined yesterday. Interesting question on how much further will prices fall, I don't think it's as simple as that.
There are individual cases where some vendors can't afford to drop any more due to high mortgages etc, they are often trapped as they can't sell at the prices they need and can hardly afford their repayments.
Then you have the property owners who will just stay-put with their properties on the market with multiple agents at rather optimistic prices, never having had a viewing in years. They can afford to sit it out and would like to sell but not give their homes away, this is quite understandable as they have often spent a small fortune on them over the years.
Next come the banks, they haven't dropped their prices enough to move anything in volume, and so to date haven't really impacted on market prices. That is about to change because they have been instructed to put liquidity into the banking system this year by dropping the prices of their housing stocks until they sell, this could do some damage over a couple of years and force prices lower in a short space of time instead of the drip, drip, drip effect since 2008.
As things stand, it's almost impossibe to know where the market is at right now, due to the huge disparity in situations described above.
I have a rule of thumb and that is anything purchased around 2000 -2003 is now back to where it was value wise. Anything purchased at the peak 2004 -2008 is selling at about half it's value when purchased.
As for the future, there are so many unknowns, such as the possible collapse of the Euro, or a 2 speed Euro. There is still the hidden bad news from America's banks as well as Europe's banks, all hiding off-balance sheet ticking-bombs.
What would help is if there was a 2 speed Euro, with the PIIGS (Portugal, Italy, Ireland, Greece, Spain) running a devalued Euro, especially if it was trading at say 1.75€ to the pound. We would see a boom in tourism and property rentals, resulting in more buyers from the UK obtaining a 100,000€ property for 57,000 pounds instead of 84,000 pounds as it is at present. I'll stop now as I'm probably rambling on a bit.