One of the bosses at Nationwide Building Society today said he expects house prices to fall by 6.5% from the peak seen last August.
Henry Jordan, Nationwide home commercial director, told MPs this afternoon that some house prices have already fallen roughly about 4%.
He then predicts some further "slight falls" to around 6.5%.
He added: "We have a very, very low exposure to negative equity currently, it's 0.1% of our book.
"So we're not seeing those movements in house prices really have any specific bearing."
When asked by MPs what a 6.5% fall would do, Mr Jordan said: "It won't increase materially."
He said this was because only around 2.5% of homeowners had a loan-to-value rate higher than 90%, partly because of the boom in house prices during the pandemic, "so there's headroom".
Bosses at some of the UK's major mortgage lenders sat in front of Treasury Committee today and were questions about the current housing market.
The hearing also covered the mortgage stress faced by borrowers and the response by lenders to people falling behind on repayments.
House prices have continued to rise since the financial crash of 2008 which saw prices drop by around 20%.
As interest rates are at their highest since the crash - many are concerned that a similar "housing crash" could happen again.
Earlier this year, Nationwide predicted a 5% drop in prices - which has now increased to 6.5%.
However, Santander has forecasted a 10% fall this year, while Lloyds Bank is braced for a 7% drop in 2023.
A drop of 10% this year would put prices back to where they were in autumn 2021.
Andrew Asaam from Lloyds Banking Group also told the committee that house price falls could leave some mortgage holders in "negative equity".
This is when a house or flat is worth less than the mortgage you took out on it.
He said: "The place that this probably bites most is for first-time buyers, who will be typically at higher LTVs (loan to value rates).
"It's a completely individual situation, but we still think owning a home for most people is better than renting.
"And therefore we want to keep products available at higher LTVs for first-time buyers.
"But we need to make sure that those first-time buyers are resilient, ie they can afford to stay in their homes through a two-year period where house prices might be falling, for example, and they are aware that they could end up in negative equity."
But the Commons Treasury Committee was told that due to relatively low loan-to-value rates cross the market, there was less risk of widespread negative equity than in previous financial crises.
