Is the property market grinding to a halt? Photograph: Getty Images
Today's gloomy house price statistics from Nationwide have sparked concern among homeowners and left economists wondering just how bad things are going to get.
Larry Elliott, our economics editor, argues that this is "judgment day" for the housing sector.
"Any suggestion that Britain's overblown, over-hyped and over-valued property market is set fair for a gentle soft landing after the excesses of recent years have just been exploded. We've had the boom: welcome to the bust," he warns.
Larry explains the four myths that have kept the market on the boil for so long, including misplaced confidence that the problems in America would not cross the Atlantic and the belief that the crash of the 1990s would not be repeated.
Radio Four's Today programme did a quick back-of-the-envelope calculation that prices are falling at around 10% on an annual basis.
They also gave Nationwide's chief economist, Fionnuala Earley, a rough ride, accusing mortgage providers of causing the crisis through reckless lending and the subsequent withdrawal of their deals (listen here).
It is clear the sudden freeze that hit the mortgage market in April is a big factor in the rapid drop in house prices. David Stubbs, senior economist at the Royal Institute of Chartered Surveyors, warned that unless the mortgage market starts functioning soon, the weakening housing market will "really hurt the economy".
The gloom prompted the Evening Standard to speculate that Gordon Brown would be shivering with fear, as the 4.4% annual drop in the cost of a house is the worst since the recession of the early 1990s.
Meanwhile, over at Housepricecrash.co.uk, there was much mocking of Nationwide's claims that things aren't too bad compared with two or three years ago.
Worried housebuilders have claimed that everything would be OK again if only mortgages were more easily available, but today the talk was more of negative equity. Larry talked about Judgment Day, but is it more a case of Apocalypse Now?
