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The recently released RICS survey has confirmed the widely reported fall in house prices in March. The survey reported that 78.5% of surveyors have noticed a decline in the house prices. However a lack of new supply has played a part in preventing an even more significant house price fall.

A number of potential buyers are either looking to move from their current homes or becoming more careful about their budgets due to uncertain economic conditions.

Since the official interest rate cuts are not being carried on to the high street there is little chance that demand will increase in the near future.

It is clear that price falls are being driven by the inability of many to secure or obtain a loan rather than an influx of supply into the market.

For people living in pricy areas such as Kensington, Muswell Hill and Wimbledon, this represents quite a serious problem. If they want to sell their houses now, they could risk losing money.

The UK public is finding it difficult not only to obtain a mortgage but to obtain a personal loan. Some lenders have changed the loan rates up to 5 times higher since the beginning of the year, while others have removed the loans alltogether from the market. Lenders are trying to make personal loans less attractive and some are even aiming to make their loans so uncompetitive that they turn away customers. Thus personal loans are becoming increasingly difficult to obtain. This might have a negative impact on the disposable income of the general public as they might not be able to have enough money for purchases such as cars.

People need to be aware of some of the factors involved when arranging the best deal for a personal loan:

• Make sure you know exactly how much you need (avoid the urge to overspend)
• Avoid the lure of consolidation loans
• Try to get a fixed-rate deal
• Pay attention to tiered interest rates

If people are still struggling to get a personal loan and have to forego luxuries such as cars then they might need to rethink if they need a house with a garage or a parking space. It might be cheaper to buy or rent a house that does not have a garage or even a garden.

The recent house price fall could be in part attributed to the slowing economy growth. This in turn is due to a number of factors:

• Ongoing credit crunch in financial markets
• Rising labour costs
• Higher oil prices
• Higher food prices

The Bank of England’s response to the negative economic situation resulted in yet another interest rate cut. This time the interest rate is down to 5%. The effect this has on homeowners and their fixed rate deals was established by announcements from both Nationwide and Alliance & Leicester. These top lenders have announced plans to increase rates on their fixed rate deals by 0.32%. This can be considered as quite a substantial increase especially for homeowners that are currently coming to the end of their short-term deals and are looking for new fixed-rate deals. This could have an impact on the areas where people will choose to own a house as two bedroomed homes in areas such as Lewisham tend to be cheaper than similar sized ones in Holland Park.

The credit crunch has forced some people to re-evaluate their spending, cut back on luxury purchases and look for ways to save money. People who are living in small houses need to be extra creative when it comes decorating their properties on a budget. There are some basics to keep in mind when trying to make the most out of a small space:

• It can be simpler and easier to work with the furniture that you already have in the house.  Try to arrange it in such a way that leaves more room for shelves, desks and wall art . This can be done by clustering furniture towards the center of the room so the surrounding walls are left free for any storage pieces.
• Buy cheap rugs and curtains in solid colours to match the rest of your decorations
• Art pieces can add style and class to any room and do not need to be expensive. When shopping for art on a budget, try visiting your local market or a craft store.
• Furniture stores may have a back room where they keep scratched and dented items available for sale at big discounts. So even if you cannot afford the prices at your favourite store, ask them about their not so ‘new’ items.

So even if you living in a studio and have limited space, there are always ways to make your house feel like a home (and you don’t need to spend thousand of pounds to do it either).

The Halifax has revised its price predictions for the year. It expects house prices to fall further over the course of 2008. Another leading lender Nationwide gave similar indications earlier this month after declaring that house prices had fallen for five months in a row.

Analysts state that the ‘weaker-than-expected’ data from the two agencies would raise hopes of the Bank of England (BoE) cutting interest rates by minimum 25 basis points in the near future.

However, since the lack of liquidity in the current money market is making it costlier for banks to borrow, any rate cut benefit may not be passed on to mortgage holders, market observers say. According to the chief economist of the Royal Institution of Chartered Surveyors, Simon Rubinsohn, the sharp fall in the Halifax house price index in March indicates the increasing pressure on the residential market even as lenders continue ‘to scale back their activity in the market.’

He added: “Loan-to-value ratios are getting lowered at the same point as borrowing rates are being increased, putting additional pressure on first-time buyers having to find ever larger deposits.”

According to the Office of Fair Trading, an estate agent must say he has an offer unless it is true. The OFT suggests prospective buyers may even ask for evidence if they have doubts. This can be rather difficult in practice, particularly if you wish to remain on good terms with the agent.

You may want to know whether you can make the seller or estate agent take the house off the property market, or stop advertising, after you have had your offer accepted. The answer is no. You cannot make a seller or estate agent take the property off the market, or stop advertising just because you do not want to lose your dream home. You probably fear being ‘gazumped’. But the agent is serving the interests of the seller, trying to secure the best price for the latter.

Can an estate agent seek a deposit? Yes, in England, Wales & Northern Ireland, but he shouldn’t hold a deposit or any other money unless covered by adequate insurance. And all money should be held in a separate building society account or bank, as stipulated in the Estate Agents (Accounts) Regulations. Importantly, receipts for deposits should be provided.

Leading UK publication, The Times, revealed in a news report that overseas property firms, comprising Abu Dhabi’s Aldar, were looking to cast the slide rule over Britain’s quoted property sector.

Hopes are reviving that as the credit squeeze continues to firm up its grip, the share prices of some of the big businesses with low-levels of long-term borrowings and well-let portfolios, will at last begin appearing fair value or even cheap.

Meanwhile, as commercial property firms get ready to face up to another month of debt markets remaining more or less closed to business, investors will be watching more keenly than ever on the health and strength of their balance sheets as well as development pipelines. Fears of further sudden and sharp falls in the share prices of many London-centric office developers are however, now looking a distinct possibility.

Research done by MWB Business Exchange, the serviced office firm, reveals that banks are growingly taking short-term leases on London offices rather than opting to commit to new long-term large lets. This has stoked fears that they were looking at job cuts. Those apprehensions were confirmed by latest research from commercial property agency Atis Real revealing that banks accounted for mere 8 per cent of new City office lettings recorded during the first quarter of 2008 compared with their long-term proportion of 40 per cent.

Shrinking mortgages continues to be a worry. Analysis and data by various market experts and institutions like the CML have brought to fore the quick contraction witnessed in the mortgage market – an outcome of problems experienced in the global financial markets. What exactly is the scenario prevailing in the property market? Here are some pointers:

• An acute credit crunch has considerably restricted and reduced the ability of building societies and banks since last autumn to lend money to customers.
• As a cascading effect, this has resulted in lenders shrinking the range and extent of mortgages on offer. They have been demanding much higher deposit amounts from harried borrowers, and simultaneously raising the interest rates on certain deals.
• The CML figures revealed that lending to first-time buyers fell to its lowest level in the three months to February since early 1975.
• The number of mortgages that were granted in February to various groups of home buyers was at its lowest level since 1992.
• Loans for purchasing a home, rather than for individuals merely expanding their mortgages to part-finance other spending or changing deals, now make up just 30 per cent of all mortgage lending; this is the lowest level on record.

The recent announcement by HSBC allowing homeowners to keep their fixed-rate deals for a further two years, has resulted in a surge of interest in mortgage applications. There are a number of key points to consider when applying for a mortgage:

1. Research all possible mortgage deals (try using an online comparison tool)
2. Calculate how much you will be allowed to borrow
3. Decide if you will be getting a broker (in the case of HSBC’s offer, you will need to go directly through the lender to apply for a mortgage)
4. Fill in the application forms quickly so you are not affected by the interest rates rise

The toughest part of the mortgage application process is the waiting for the results. This process can take up to six weeks. In the meantime, you can start planning how you will be decorating your house and choosing what to plant in your garden.

‘Lifetime Homes, Lifetime Neighbourhoods’ is a scheme designed by the government to help older people get access to good quality housing. It could also result in all future homes being built to allow for modifications like wheelchair access and stairlifts, according to campaigners.

A recent Lincoln Financial Group survey pointed to the fact that retaining and living in one’s own home for the remaining part of their life remained a top priority for most of the old people on the cusp of retirement.

A financial expert mentioned: “A good quality of life is the important financial need for individuals who are already retired or are heading for retirement. Keeping (or having) their own home is the key!”

Of course, this is easier said than done. Property prices have considerably increased over the last decade, even after taking into account the present and prospective fall, adding to the woes of a fast ageing British population. However, with the UK government’s new apparent commitment to making sure that the people can live in their homes for longer, things could finally change. ‘Lifetime Homes, Lifetime Neighbourhoods’ is a step in the right direction.