It is currently touch and go as to whether we will escape a technical recession
The combination of the squeeze on the housing market, together with the pressure on household incomes from increased food and energy prices, means that GDP is only expected to rise by 1.4% this year and just 1.2% in 2009. As a result, unemployment is set to rise by over 250,000 over the next 18 months.
The housing market is already in deep recession. The freezing in credit markets has led to a 70% reduction in mortgage approvals since their peak.
House prices have already fallen by approximately 10% since last autumn. With mortgage costs rising and the market being so negative, prices are expected to fall by a further 10% over the coming year.
Sarah Walford from local debt advisers revivalforyou.co.uk says “If you’re struggling to meet your mortgage payments, or can’t afford your monthly household bills, seek advice sooner rather than later. By doing this there are more options available to you”