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Lib Dems criticise government over mortgages
2 January 2009 18:29
The government is currently faced with something of a stalemate situation in the property market, the Liberal Democrats have suggested.
Shadow Chancellor Vincent Cable has said that the government cannot hope to boost house sales at a time when property prices are falling but potential buyers are too worried about falling into negative equity to go through with sales.
Mr Cable made his comments in response to the news that mortgage approvals in the UK were at their lowest level for nine years in November 2008.
He said that a complete slowdown in mortgage lending is not helping matters in terms of re-starting the housing market.
Mr Cable suggested that the government needs to come up with a mortgage product that will prove very beneficial to first-time buyers in order to try and get things moving.
He also observed that nationalised lender Northern Rock should be encouraged to start new lending.
The shadow chancellor also emphasised how important it is to try and prevent the collapse of the construction industry and also that more social housing is needed.
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