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Grimm truth 1

House prices

House prices have already fallen 5.3% since their peak last August, according to the Halifax. Year on year, the fall in April was 0.9%, to 189,027. The lender predicts a 鈥渕id single-digit fall鈥� in prices in 2008. Meanwhile, Nationwide reported that prices fell 2.5% in May, the biggest drop since 1991.

There will be a 7% fall in house prices in 2008, according to the Council of Mortgage Lenders (CML).

According to housing data company Hometrack, prices have been falling since September 2007.

Changes in prices are highly variable by region. Rightmove says London and the South-east are the best performing regions, with prices in April showing a rise of 5% in the capital and 6% in the South-east compared with last year. However, prices in Yorkshire, Humberside, the North-west and Wales have fallen more than 2% over the past 12 months.

Grimm truth 2

Starts on site

The government says 167,501 homes were completed in England in 2007/08, which was the second highest figure in the past 10 years. However, starts have been falling for the past two years, from a peak of 184,906 in 2005/06 to just 156,437 last year.

John Callcutt, a former chief executive of Crest Nicholson, said: 鈥淲e鈥檒l be lucky to get to 110,000 completions this year.鈥�

Keith Miller, the chief executive of Miller Group, said: 鈥淲e鈥檒l be down to about 100,000 鈥� it鈥檒l be the lowest level since records began.鈥�

Mike Farley, chief executive of Persimmon, said: 鈥淚t is going in the wrong direction. We could see 110,000 or 120,000 houses built next year.鈥�

According to government statistics, housing starts in the first three months of this year were 24% below the same period last year.

Grimm truth 3

Mortgages

The CML said the number of home loans advanced in the first three months of 2008 was 142,000, the lowest since 1975 and half the number that was agreed in the summer quarter last year. In the nadir of the 1992 recession, the number of home loans agreed fell to 146,000 in one quarter.

Net lending is likely to fall by 49% to 拢55bn in 2008, the CML says. This level would be the lowest number since 1999, even without adjusting for inflation.

The number of mortgage products on offer has fallen by three quarters in the past year. Financial comparison website Moneyfacts says they have reduced from 15,599 to 3,847.

Moneyfacts says only 12% of mortgages accept buyers with deposits of 5% or less. This has fallen from 47% of mortgages before the credit crunch (even without adjusting for inflation).

Grimm truth 4

Jobs

There will be an estimated 28,900 job losses in the housebuilding industry in 2008, according to projections by Experian and ConstructionSkills. This will fall further in 2009, leaving 35,500 fewer people in the industry than in 2007. By that stage, there will be 371,000 people employed in the housing sector.

The Home Builders Federation (HBF) says 300,000 people are directly employed in the housebuilding industry. Stewart Baseley, the chairman of the HBF, told the Evening Standard there wasn鈥檛 a 鈥渂uilder in the land who isn鈥檛 considering job losses鈥�. He added: 鈥淲e need action now to prevent widespread redundancies in the housing industry.

Taylor Wimpey is cutting 600 staff (13%). Bellway is cutting 370 out of 2,476 staff (15%). Crest Nicholson is cutting 80 out of 800 staff (10%). McCarthy & Stone is cutting 120 out of 1,212 staff (10%). Redrow has cut 200 of 1,372 staff (15%).

Grimm truth 5

House sales

Sales will fall 24% to 770,000 in 2008, according to the CML. This would be the lowest level of transactions since the seventies.

The number of transactions was down 17.6% in February on the previous year, to 116,000, according to Hometrack.

The NHBC says the average number of daily new house sales fell to 466 in April, down 20% on April last year. On average 477 have been sold each day this year. This compares with 572 last year.

The average time it takes to sell a house has risen since the start of the credit crunch from 6.9 to 9.1 weeks, according to Hometrack.