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Redundancy fears are hitting property recovery, warns BSA

Unemployment passed the two million mark last week, as the Building Societies Association warned redundancy fears were denting consumer enthusiasm to get on the property ladder.

Figures from the Office for National Statistics show unem-ployment is now at 2.03 million, or 6.5% of the working population.

The Building Societies Assoc-iation’s Property Tracker survey found that 54% of people believe now is a good time to buy property in the UK, a leap from June last year when just 27% reckoned it was a good time to buy.

Biggest barriers to home pur-chase remained the same as in December – lack of job security, access to a large enough mortgage and raising a deposit.

People expect prices to fall by a further 6% over the next year, found the survey but just under a third viewed falling prices as a barrier to buying at the moment. Paul Broadhead, head of mortgage policy at the BSA, says people are beg-inning to recognise that there are bargains to be found and they are increasingly interested in buying.

But he says: “It is also clear from the survey that it is the declining economic situation and perceived problems securing a mortgage that are viewed as preventing this desire to buy from being realised. Until economic confidence improves it is hard to see the feel-good factor returning to the housing market.”

Meanwhile a study by the Centre for Economics and Business Res-earch says tax from the financial service sector for 2009 and 2010 will be down £29bn.

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