The property sector may suffer a period of great difficulty if the economy as a whole shrinks, it has been asserted.
Head of development research at global property consultancy Knight Frank Jon Neale said that if the economy goes through a rocky period, the housing market may suffer.
"There is no denying that prices are coming down quite rapidly at the moment and the main reason for that is inability to access mortgage finance. This is now being exacerbated by a more pessimistic outlook for the UK economy," said Mr Neale.
He added that the Organisation for Economic Cooperation and Development has predicted that the economy will shrink over the last two quarters of the year.
And if unemployment increases, then the country may enter a period of difficulty as a whole, he said.
Figures revealed in the Halifax House Price Index for August show that the cost of a home fell by 1.8 per cent in the month. The research also found that the house price to average earnings ratio has now dropped from 5.84 in July last year to 5.13 by June this year.
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