Press Article
Gov't must take decisive action, warns RICS
By Joy Dunbar
Financial Adviser,
Thursday , September 04, 2008
The Royal Institution of Chartered Surveyors supports a 15-point plan to tackle the credit crunch's effect on the housing market.
Dealing with the current housing market downturn requires significant and decisive action from the government whose attempts to date to address the problems facing the market have been limited, according to Royal Institution of Chartered Surveyors.
Housing transactions have fallen by more than 60 per cent in the last year, with many sectors of the economy feeling the strain according to RICS in its Tackling The Credit Crunch report.
It added the sharp reduction in mortgage lending has resulted in a vast accumulation in the stock of unsold property on estate agents' books and this has inevitably put downward pressure on house prices.
The institution supports a 15-point plan to tackle the credit crunch including: fiscal and financial measures; new models of home ownership; availability and affordability of housing; improving consumer information; and improving regulations and standards.
Gillian Charlesworth, director of external affairs for RICS, said: "The market needs decisive Government action on a range of fronts if it is to pull itself out of the doldrums and we call on Government to listen to the market’s solutions to a whole set of problems.
"We know there is no silver bullet that will slay this monster but we need a joined-up, comprehensive approach to bring back confidence and to give the public clarity about what is available.
"While we wait for the government to act on all the necessary fronts, many home owners are trapped in a market offering little or no mobility without any prospect of good cheer in the autumn."
James Carter, principal for London-based IFA Independent James, said that everyone has an opinion on the housing market. He said: "This is just a down turn. There is a lot of over-reaction and everyone is good at telling the government what to do, price changes are due to market forces. There is also a lot of political pressure on the chancellor Alistair Darling and the Prime Minister Gordon Brown. Last year, a lot of commentators said that they wanted house prices to come down to help first time buyers and now that they have everyone wants the government help them bail them out."
The news comes as Bank of England figures, which show new mortgage approvals fell by 71 per cent in the last year.