Home Based Business

We have ended 2007 on a cliffhanger, with buyers, builders, sellers and speculators all holding their breath. Nobody now doubts we have entered a slow down, it's now a question of how long will it last and how low it will fall.....

Will the value of your property hold, will your mortgage become more costly than the home it provides? And if you're looking to buy, what will happen to the price of the property you want?

The housing market in the UK is feeling the pain caused by America's subprime crisis, turmoil in the financial markets and the most pessimistic outlook we have seen for years.

The clampdown by the banks and building societies burned by the US loans crisis, means fewer people are being forwarded mortgages, and less money is forthcoming and at a higher cost.

So, will we have a disastrous economic 2008 or just a slightly depressed market for house prices? There is a lot of uncertainty, but several leading economists have forecast significant drops in housing values in 2008 and onto 2009.

The giant credit wave we have all rode on has come to an end, and the market has been left vunerable by the high cost, high value mortgages that were needed to afford housing in the areas that had rapid price rises.

One property website, Primemove.com  suggested some areas may well see prices drop by as much as 40%, with the main losers being those who bought in the last year.

Sales are expected to drop to an all time low, and estate agents are already releasing anecdotal evidence that they're already experiencing a dramatic fall out of buyer inquiries.

The depressed market is forecast to last through 2008 and into 2009, regardless of the expected interest rate cuts from the Bank of England.

What should you do? Sit tight, don't panic but do stop spending money on unnecessary purchases. Do clear whatever credit bills you can, so you have more money to pay on your mortgage. Most importantly. do whatever you can so you don't have to sell your home.

Because whatever happens, you're always going to need somewhere to live, to sleep.