Rampant unemployment, low demand despite falling prices, the removal of tax benefits and onerous loan conditions being applied by banks do not explain the continued obsession with building more houses but it does account for the fact that the number of mortgages granted in July fell to an all-time low.
The number of mortgages granted by banks in July 2013 was 13,777, down by 42.7 compared to the same month last year. They are now at the lowest figure since such statistics were first collated, namely 1995.
In June the fall was 42.2% and there have now been 39 consecutive months of year-on-year declines. This is despite a 40% fall in the price of houses.
On the other hand, rampant unemployment, the removal of tax benefits and banks being reluctant to lend money have certainly not helped the situation. There has, however, been an increase in the number of cash transactions for houses.