Lack of lending means developers are losing out: Mouseprice

The numbers of new developments is plummeting because of the lack of lending, one expert has claimed.

Selwyn Lim, director at Mouseprice, has suggested that because developers rely heavily on lending, when the flow of credit runs dry they have no cash to build.

"What we are seeing now is the number of house starts, which is an indicator which says how much building works are going on, these figures are plummeting," Mr Lim said.

The lack of new developments could see more people look to self build or renovate an existing property.

This month, Nationwide reported that house prices fell by 1.7 per cent in September, representing a 12.4 per cent fall compared to this time last year and bringing the price of a typical home in the UK to £161,797.

According to Mouseprice's Annual Street Rankings 2008, the most affordable street in England is Oxford Street, South Elmsall, in Yorkshire and the Humber, with an average price of £27,400.