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Mortgage woes triggered by the credit crunch are set to continue into next year, according to a study by the Association of Mortgage Intermediaries.

Looking at the coming year, the trade body predicted net lending for 2008, roughly £55bn, will be half the levels seen in 2007, and warned that it is unlikely to increase in 2009.

The paper The Credit Crunch - One Year On, argued the impact on intermediary business meant average incomes are set to fall by up to 30 per cent or 40 per cent in 2008, staying flat in 2009 before beginning to recover.

Chris Cummings, director general of Ami, said: "The impact of the credit crunch is likely to be felt much longer and despite the intervention of the US administration and recent moves by the UK government, the housing and mortgage markets are not likely to recover in the short term."

The association said the impact on the industry will see business consolidation, with closures and redundancies continuing until the market recover.

Mr Cummings said with more borrowers finding their access to finance restricted, they will need the advice a broker can provide. He expected the use of brokers to settle at a higher level than the long run average as a result of these changes.

He said: "In the short term, we will see a smaller, leaner industry but the remaining firms will have the best staff and will be stronger and better diversified."

The association said the key to surviving the slowdown is a strong, effective business leadership, income diversification, relationship management and cost control.