The number of first time buyers taking out mortgages fell to a new low of 19 per cent during January, according to figures released by the Council of Mortgage Lenders (CML). This was the lowest number recorded since CML started tracking monthly figures in 2002. The report revealed that 50,300 buyers had home loans accepted, which was down 34 per cent on the previous January.

These disappointing figures come in the wake of surveyors pointing to last month's severe downturn in the housing market being the worst since the slump in June 1990. 64.5 per cent of surveyors reported a fall in house prices then, compared to 64.1 per cent for February 2008. This total is up from 54.8 per cent in January this year.

Citigroup spokesman, Michael Saunders warned, “This is very soft indeed, reflecting the interplay between stretched valuations, tightening lending standards and widening lending spreads. The further adverse effects of rising repossessions, weakening job growth and then probably a rise in unemployment still lie ahead.”