Original features, good schools near by and a deli/coffee shop around the corner. These were the kinds of things that used to determine the value of your house.

But today “CDOs” are having an equal - but much less beneficial - effect. These malign influences on the price of your property are collateralised debt obligations, bundled-up packages of loans such as the mortgages sold to US sub-prime borrowers who never ought to have been lent a cent.

How did we get to here? Well, believe it or not, UK banks were eager purchasers of billions of pounds worth of CDOs. Today these holdings are close to worthless.

After the collapse of Bear Stearns, a previously obscure institution that became a household name over a weekend, much has been written about how the CDO barged its way into your living room, an unwelcome guest likely to stick around for a while. But all that homeowners need to know is this: the toxic pile of CDOs held by the big banks has caused much of the deep suspicion in which they currently hold each other. They are not at all keen to lend to one another - and may be even less eager to give you a mortgage.

BACKGROUND

• Opening bids - Is it Christmas already? Tell Santa to break out a rate cut without further delay?

• Which economists will win the contest to be the gloomiest over the future for prices?

• Which camp are you in - storm clouds or showers? Even the experts are split

• Opening bids - a year in property

BACKGROUND

• Opening bids: Why the Government must do something about Britain’s empty properties

• Will there be a rate cut before Christmas? Kate Barker knows - but she’s not telling

• Downturn and downtown in 2008: how investors in UK city-centre flats may feel the chill first

• Opening bids

Sub-prime slime is oozing out everywhere from the US -where will it spread next?

BACKGROUND

• Comment: The housing shortage

• Ripple effect from Belgravia to the suburbs

• Comment: the property market slowdown

• Tax perks for a few are adding to the property have-nots’ sense of injustice, but don’t expect reform any time soon

• This was not a timely retreat. What does the government now mean to do to save the planet?

The silencing of our Mr Spocks

Our public administration has specialised in low-level, chronic inefficiency with a counterpoint of big talk

BACKGROUND

• Average prices in the South are 1.59 times higher than the North

• The City’s ardour for status homes remains unabated

• The dawn of a more eco-conscious Britain may be delayed

• It's bonus time, let the stampede begin

• Prices and politics either side of the border

Hips will make us greener, or so the Government says

• Hips have already won hearts and minds and will make us all greener, or so the Government says

BACKGROUND

• Mortgage competition makes millions immune to base-rate moves

• Hidden costs of a place in the sun

• Primark Principle revises gloomy views

• Going green is not cheap

As Bricks and Mortar forecast last August, events in the global financial markets were likely to have the greatest impact on the price of your home this year. At that time, we had only an inkling of the foolhardiness of some of the players in these markets, including the UK banks. Now the consequences of their risk-taking are a problem that every homeowner must face. The scarcity of finance will depress property prices.

Indeed it may even cause a major lifestyle shift: the British have been in the habit of moving house every seven years. The slide in transactions resulting from the difficulty in obtaining finance is predicted to increase this to every 25 years.

Lower house prices ought to present opportunities to first-time buyers. Yet they will be among those hardest hit by the banks' dangerous dalliance with the CDO, callow and immature behaviour that indicates that these institutions do not practise the prudence that they still have the nerve to preach.

However, although the banks may be minded to give them the cold-shoulder, first-time buyers may receive a warmer welcome at the building societies, whose involvement in the CDO thing was minimal. Nationwide, the sector's number one, is still lending to first-time buyers, even those with a deposit of just 5 per cent.

But one of the most popular sources of funds this year will be the Bank of Mum and Dad; parents who have made a wise investment in property will be using their equity to turn their children from tenants into owner-occupiers. This will be an example of mature behaviour, based on the view that the monetary value of a home is only one of its attractions.

A VIEW TO BANK ON

The marine view (pictured) will set you back £4.5 million. But, for this price, you also get brand-new house with direct beach frontage, a media room, a living room, two bedroom suites, a lift with a “honed” limestone floor and lots more, all detailed in the literature from Savills, the estate agent handling the sale.

If you are still puzzled that so high a price can be put on the chance to gaze upon the sunset over the sea, you should know that this is a home on Banks Road, one of the best addresses in Sandbanks, variously described as “Dorset's answer to Monaco” and as “Very nice and all that, but where are the beautiful people?”

The answer to this last question is that the billionaires who settle in Sandbanks delight in all the publicity about the building boom, in which shabby bungalows make way for lavish mansions, but also like the privacy that comes from a lack of celebrity inhabitants. There are perma-tans down the Peninsula Road, another Sandbanks top location, but no paparazzi.

This is a town where the homes are the stars, including Thunderbird. This space-age style property, now being let out, was on the market for £3.5 million when Bricks and Mortar reported on the Sandbanks scene in August 2006. Liam Gallagher, of Oasis, was among those subsequently tipped as potential purchasers. He probably realised that his, well, abrasive personal style was just not very Sandbanks.

BATHING MATTERS

The bathroom in the master bedroom of the Sandbanks house has a plasma TV screen. But such expenditure merely reflects the trend in all types of domestic setting. The point of a bathroom used to be hygiene; now it's leisure. Expect the crowds in the DIY and homewares stores this weekend to be around the shower fittings. The ultimate aspiration in this latest makeover obsession is the £38,697 Papillion bath in marble or granite. But a word of caution: it weight means that it can be installed only on the ground floor.

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