UK: House Prices Fall at Fastest Rate Since 1978
April 15th, 2008Via: Guardian:
House prices are falling at their fastest rate since records began 30 years ago as the mortgage lending freeze continues to undermine the housing market, the Royal Institution of Chartered Surveyors says today.
In a big blow to the government, which claims Britain is well-placed to withstand the global economic downturn, the RICS paints a bleak picture, in which the number of estate agents saying house prices rose, rather than fell, has dropped to the lowest point since the survey began in 1978.
The latest monthly snapshot of the housing market shows that 78.5% more surveyors reported a fall than a rise in house prices. The gulf has widened since February and easily eclipses the previous low of 64.5% in June 1990, when the economy was heading into recession.
The survey comes amid growing government frustration with banks and mortgage lenders. Gordon Brown has summoned the heads of Britain’s top banks for breakfast meetings today, and while ministers still believe the housing situation is not as severe as the 1990s slump, they are concerned that some lenders are exploiting the global financial crisis.
Caroline Flint, the housing minister, will join forces with the chancellor, Alistair Darling, next week to step up pressure on Britain’s mortgage lenders to offer existing and new borrowers a fair deal. They will tell the Council of Mortage Lenders that buyers must be “treated fairly” and that people are not stretched beyond their means. The lenders will be told to ensure that “principles of responsible lending for customers are upheld and applied”.
