From This is Money:
The US Government’s dramatic weekend decision to bail out its biggest mortgage companies set off a surge in share prices around the world.
It also exposed the timidity of the British government when faced with the meltdown at Northern Rock and the collapse of property sales.
Estate agents selling just one home a week
A Treasury review is already being held into the way the housing market is financed in the UK. It will be given added urgency by a warning from the head of Britain’s biggest building society, the Nationwide, that house prices could fall as much as 25% from last year’s peak, pushing millions of homeowners into negative equity.
The Chancellor, Alistair Darling, is due to decide within weeks whether to back an expected recommendation to provide taxpayer backing for mortgages worth billions.
The review is being led by City banker Sir James Crosby, who has already delivered an interim report. Proposals he is considering could see the taxpayer becoming responsible…