WASHINGTON - Mortgage securities are not expected to return to any significant growth until 2011, despite efforts to restart the market that provided much of the residential credit during the housing boom, according to a industry survey released on Monday.

Forty eight percent of investors and dealers polled by the American Securitization Forum said the residential mortgage-backed securities market would likely recover sometime in 2011. A quarter said it would do so by year end 2010, according to the study released at the ASF's 2010 conference in Washington.

Panelists debating the timing of recovery pointed to a host of hurdles, including finding a bottom to the housing market. Dealers are actively seeking ways to structure the first deal in some two years, sources said. Reaching enough volume to impact the struggling housing market is still in question.

The biggest issue to resolve in bringing back an RMBS market is finding the bottom of the housing market, Jordan Schwartz, a partner at law firm Cadwalader, Wickersham & Taft LLP, said during an ASF panel discussion.

The urgency to find a way to restart the flow of private credit to the U.S. housing market is coming to a head this quarter when the Federal Reserve is slated to end a program in support of the mortgage market - the purchase of $1.25 trillion in another type of mortgage security packaged and issued by government-related entities such as Fannie Mae.

The market needs to find a sustainable way to get mortgages off the U.S. government's balance sheet, Schwartz said. Fannie Mae and rival Freddie Mac, issuers of agency supported mortgage bonds, are effectively backed by the U.S. after their regulator took control in 2008 and the government last month said it would absorb unlimited losses.

Without clarity of a peak in default and foreclosure rates, it is difficult for issuers, dealers and investors to agree on how to structure a security that provides enough protection for the safest, AAA rated portion, or high enough yields to compensate other investors for risks, he said.

Currently, there are big gaps in how different parties in a securitization would structure a deal, panelists agreed.

The struggle in 2010 will be among issuers and dealers and investors to find the right price at which everyone is sufficiently happy, Sanjeev Handa, head of global public markets at TIAA-CREF, an investor, said on the panel.

(Editing by Andrew Hay)