House prices could fall for two years-Citigroup

(Updates with full quotes)

LONDON, July 19 (Reuters) - Citigroup (C.N: Quote, Profile, Research) chief Win Bischoff has warned that house prices in Britain and the United States are likely to keep falling for two years.

The chairman of one of the world's most powerful banks told the BBC in an interview that he expects it will take two years for the markets to "stabilise."

He also said he expected the credit crunch could continue through until 2009.

"At the end of last year people thought it might affect the first half of this year but that we would see some stabilisation in the second half," he said.

"I think that prognostication has now gone much more into 2009 ... Most people think 2009 is still going to be quite a difficult year," he added.

Bischoff told the BBC that there would be redundancies at the bank, which employs 12,000 people in Britain, and warned that some of them would be compulsory.

Commenting on the outlook for the U.S. housing market, he said "I think it will take some time -- two years perhaps -- till the markets stabilise. We certainly think that in certain areas of the United States it will take that long."

As for Britain, he asked "How long will it take? Again I think two years might be an estimate. I don't think it will be much quicker than that." (Reporting by Paul Majendie, Editing by Jon Boyle)