The Federal Reserve is currently reviewing banks' exposure to property, the troubled investment sector whose slide could pose a risk to many financial institutions because of the wide distribution of loans and mortgage-backed securities.

In its regulatory role, the Fed will look into a cross-section of banks to build a picture of how resilient institutions are to the falling value of loans and commercial mortgage-backed securities.

A cross-disciplinary team will look at the range of commercial property assets on banks' balance sheets, encompassing loans and CMBS.......

The number of people out of work in the UK has risen to its highest level in 14 years, official figures have shown.

Unemployment increased by 210,000 to 2.47m in the three months to July, taking the jobless rate to 7.9%, the Office for National Statistics said.

Claims for unemployment benefit in August grew by 24,400 from July to 1.61m, the highest since May 1997.....

The eurozone is emerging from recession, according to the latest forecast from the European Commission.

"The economy appears to be at a turning point," the commission said.

It forecast growth of 0.2% for the July to September quarter, with Germany and France continuing to grow and Italy exiting recession.

The commission also forecast the UK economy, which is outside the eurozone, would grow by 0.2% during the third quarter, marking the end of recession.......

Britons saw the value of their wealth dive by 12% during 2008 on the back of steep house price falls and sliding equity markets, research has showed.

The collective wealth of all UK households dropped from £6.736 trillion at the end of 2007 to £5.921 trillion at the end of last year, according to Halifax.

The high street bank said it was the first time a decline had been recorded since 2001.

The fall was largely driven by a steep drop in property values, with around £384 billion wiped off the value of people's homes during the year, leaving them collectively worth £3.693 trillion.

But the reduction in property wealth could be even greater as Halifax based the research on the Communities and Local Government house price index, which recorded a 9% slide during the year - nearly half the 17% it reported for the same period.

Not only did the value of people's housing wealth fall, but the value of their financial assets, such as shares, also dropped by 9% or £381 billion in 2008 as global stock markets dived in response to the credit crunch.

The FTSE 100 Index lost 31% of its value during the year, the worst annual performance in its 24-year history.

The problem of falling asset values was made worse by the fact that people continued to take on more debt during the year.

The value of outstanding mortgages on property rose from £1.187 trillion to £1.225 trillion in 2008.

At the same time, unsecured borrowing, such as credit cards, overdrafts and loans, rose by £12 billion to £234 billion.

Source: Channel 4 News

House prices have rebounded to levels last seen at the end of 2008 after increasing for the second successive month in August, according to figures out yesterday.

Halifax said average prices rose by 0.8 per cent — the fourth month since the start of 2009 in which the lender has recorded an increase. Recent stabilisation has resulted in prices remaining “largely unchanged” in 2009, bringing the total fall from August 2008 to 10.1 per cent, the lender said.

Martin Ellis, housing economist at Halifax, said: “Demand for housing has increased since the start of the year, due to better affordability and low interest rates. This, together with low levels of property availability for sale, has boosted house prices over the last few months.”

In what is increasingly coming to be regarded as a long-term upward trend rather than a blip, estate agents said that property prices were rising faster in some parts of the country than the Halifax figures suggest.

Peter Rollings, managing director of Marsh & Parsons, the estate agent, said: “The increase in house prices nationally comes as no surprise and in pockets of the country — most notably in London — prices are rising faster than these numbers indicate.

“The underlying problem is a lack of supply of properties on the market,” Mr Rollings added. “Some homeowners lack confidence and are reluctant to take on a bigger mortgage and the cost of moving, while others are restricted by difficulties in obtaining a larger mortgage.”

Evidence that the housing market is still suffering the consequences of a severe correction remains widespread.

Nicholas Leeming, director of PropertyFinder.com, said: “The recession is almost certainly over and the latest good news on the housing market shows the recovery there is real, not a false start. But it’s also quite clear the economy and the housing market are still in intensive care and will need strong support from low interest rates and additional money supply for some months to come.”

Some commentators expect that there may be a diminished performance, and even a return to slight house price falls next year, if the Bank of England increases interest rates.

David Smith, senior partner at Carter Jonas, the chartered surveyors, explained: “Higher interest rates, when they do come, will result in fewer buyers, which will reduce demand and once again apply downward pressure on prices. The combination of increased supply and reduced demand could catch a lot of people out in 2010.”

Meanwhile Redrow, the house-builder, announced its “worst ever” annual results yesterday, a loss of £140.8 million in the 12 months to June. Although this was an improvement on the £193.9 million loss suffered a year earlier, Steve Morgan, the chairman, said: “It is intensely disappointing to me to have to report the worst set of trading results in the company’s history. I am determined to ensure that this will not be repeated and, along with the rest of the management team, am clearly focused on steering the business back to delivering the sort of robust performance that it has delivered in the past.”

Like other housebuilders, the group intends to shift its focus away from apartments, which have fared badly in the past two years, towards more traditional family housing. It will introduce a new range of homes with an historical architectural theme in an effort to re-establish the brand. However, analysts warned that an equity raising at the company was still on the cards.

Revenue from sales more than halved from £650.1 million last year to £301.8 million this year, as the average price of a Redrow home fell from £156,900 to £137,400 and the number of properties sold declined from 3,925 to 2,113.

Mr Morgan, who founded the company 35 years ago, said that he intends to start buying sites again, adding that the company had made a mistake by purchasing “very little” land in 2005.

He hopes to have acquired 12 new plots by the end of the year but acknowledged that there were very few opportunities to buy in the present market.

Source: The Times

A recent recovery in the housing market is likely to have been built on unstable foundations, a group of economists claims on Thursday, after a fall in demand and p.........

Estate agents have reported a surge of interest from potential buyers as the end of the Government's stamp duty holiday looms, it has been reported.

Countrywide Estate Agents, which has more than 1,000 branches across the UK, said it had seen a 69% increase.......

While the life of a student can be one of small budgets and wafer thin expenses, an ongoing student flats scam is proving a disaster for many. Fraudsters are using the Internet to attract students to "cheap properties" and asking them to forward their bank details or send money to secure a deal for the property.

London prime property prices have risen for the 5th month in a row, a new index has revealed.

According to the Knight Frank Prime Central London Residential Index, sales volumes are up 90% compared to January 2008, and Houses continue to outperform flats.

Liam Bailey, head of residential research, Knight ...

The low rate lasts for two years and is set at a 1.95% discount to the bank's standard variable rate of ...   more »