It was announce today that U.K. house price had fallen by 0.4% in April.

There had been signs of the market starting to stabilise in certain areas, but research has revealed that the house prices are now starting to drop again. This is on top of the number of new mortgages being approved hit a low for the first time since January.

There are mixed opinions amongst property experts as to whether the market is going to fall even further this year. Looking into the history of the last recession, the U.K. was in a recession last time for about 7 years.

Timing Why Now

Household Dept has been building up over the last 10 years it has now reached a level where consumers have a debt of approximately £1.4 trillion collectively, and people are being repossessed every day. 

What do we do in a recessions

Unfortunately the commercial and freehold sector is one of the early casualties in a recession, which in turn has a hard impact on redundancies and property owners facing repossession. Companies are going into liquidation such as Woolworths, which I am sure shocked, us all, but unfortunately there are many companies large and small struggling to balance their balance sheet, and have no option but to either cut back, make redundancies or close.

The impact that a recession has on the economy

The U.K. slow down i.e. people have reduced spending, produces a slow down in production and this produces cut backs. So many industries are feeling the squeeze, retail, building and development, importing & exporting, travel, car trade, etc, etc,… this climate is very uncomfortable for most businesses to consider investing or expanding.

Are all the incentives good enough?

Could this be a short, sharp recession? If the main problem was only the economy, it probably might be.

In 1992 the government ended of the last recession which saw a record number of people being repossessed, the government took measures and they are implementing those measures again today, but the government realise that there is a difference. The difference in the financial credit crunch is simply because the banks are concerned about lending to one another.

Possible length of the recession!
 

It is an impossible answer, even for the best economist, it is like asking, how long is a piece of string?

The economists are currently planning a variety of possible outcomes. The good thing is they all confirm that the recessions will end, because every recession has always ended, but unfortunately it has a lot of casualties to go with that i.e. people being repossessed

FSA repossession figures and how to stop repossession
 

The FSA reported that the number of repossession had risen around 60% in the first quarter this year but the number of people having mortgage arrears had gone down, this is a contradiction to what the Council of Mortgage Lender (CML) had published. Nether the less this is still not great news for those who are facing repossession or who are looking to stop repossession.