USA property prices predicted to fall further

Prices for USA real estate are likely to drop further this year, an expert has predicted.

Chief economist at Goldman Sachs Jan Hatzius told CNBC that housing is currently being fairly valued, but some further declines are expected until prices bottom out in the latter half of the year.

He attributed the further small drops to the oversupply of real estate in the market, but added the firm is "pretty confident that we're pretty close to the bottom here".

Mr Hatzius went on to suggest USA property values will pick up gradually once vacant properties are filled, but not before the second half of the year when prices will hit their lowest point.

Last November saw pending USA real estate sales rise to their highest level in 19 months, the National Association of Realtors recently revealed, marking an increase of nearly six per cent compared with the same month in 2010.

Record high housing affordability conditions were given as a reason for the increase in house-buying activity.

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