Agent offers gloomy prognosis for housing market

29/07/2008

The UK housing market will not recover until the credit crunch ends, it was claimed today.

Estate agent Savills also predicted that house prices would drop by a further ten per cent by the end of 2008 - a trend which, it is likely, would lead to a further constriction in credit availability.

The global crunch has hit the housing market hard, with rate hikes and withdrawals of home loans leading to a decrease in market activity and a rise in projected repossessions.

According to a recent report from the Bank of England, new home loan agreements have dropped to just 31 per cent of last year's level.

Kevin Still, EuroDebt director, commented: "These predictions echo many that have been made in recent months and suggest that indebted homeowners should be thinking hard about protecting their home during tough economic conditions.

"Prioritising payments on mortgages, secured loans, council tax and utilities will be essential as the squeeze on disposable income continues for the foreseeable future."

Further gloom for consumers also seems likely, should the International Monetary Fund's latest economic predictions prove true.

The body released new forecasts this week, which see no end in sight for the global credit crunch.

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