The sky’s falling in, at least if you are caught in the financial hurricane that has blown in from Wall Street in recent days. That means Canary Wharf - you would not want to be selling or letting there – the City and plenty of points further afield. To the extent that investment bankers’ money has been supporting the swankier end of the market in London, the southeast and beyond, all will suffer, including country houses. There will also be a trickle-down to the rest of an already depressed market.

Even more dramatically, Britain’s biggest mortgage lender, HBOS, has been forced into the arms of Lloyds TSB. All this reinforces the gloom about the opening-up of wholesale mortgage markets any time in the near future.

When everybody from the US treasury secretary downwards says that the end of the crisis depends on American house prices stabilising, which in his view will not happen for some months, it is clear that the intense squeeze on mortgage availability will persist. Housing activity, at best, will trundle along at the current depressed levels. The big change from earlier in the year has been that mortgage demand has come down to levels more in line with depressed supply. This has been a year to forget in the housing market.

One of the aims of this column is to bring you statistics you may have missed elsewhere. Last week, we had an official release that many will have found surprising. The Department for Communities and Local Government (DCLG) reported that the average house price rose by 1% between June and July to £217,171, and was a modest 0.3% lower than on a year earlier. Prices in the latest three months, down by 0.5%, fell by less than they did in the previous three, when they dropped by 1.3%.

All price measures need to be interpreted with care, including those from the Halifax and Nationwide, which get the most coverage. The DCLG measure adjusts for the size of property, but not for seasonal factors, so one reason it looks less gloomy is that it reflects the market’s normal spring-summer uplift, even though that was barely discernible this year. The DCLG is still showing an annual fall in house prices, as are all other measures. There is a legitimate debate about the scale of that fall. What is not in doubt is that the downward pressure will persist for a while yet.

home.economics@sunday-times.co.uk

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