Housing Market Worse Than 1990's Crash

The housing market downturn has continued to gather pace in the last few months and now feels worse that the last than the crash in the early 1990s, an expert has warned.

Speaking to Reuters news agency, David Ritchie, chief executive of builder Bovis Homes, said that sales for 2008 completion were down 35 per cent in the first half of the year, adding that decline had accelerated to two-thirds in the last eight weeks of the period.

He said: ""Many people are commenting now that this feels an awful lot worse than the downturn in the early 1990s, which I would certainly concur with."

Reuters reports that Bovis has plans to cut 400 jobs and massively cut dividends in order to cope with the dreadful conditions in the housing market. But Mr Ritchie told the agency that Bovis remains in a better position than many of its competitors.

According to Nationwide, house prices fell by 0.9 per cent in June, less than half the rate of the previous month. The building society is planning this week to reduce the price of its tracker and fixed-rate mortgage deals to encourage more buyers back to the market.