Mortgage approvals down sharply in Britain

LONDON, June 24 (UPI) -- Mortgage approval rates in Britain fell 20 percent in a month and 56 percent from a year ago, sparking worries of a widespread housing crash, sources said.

"We are in for an extended, deep correction in the housing market," economist Howard Archer with Global Insight told the Times of London.

The drop in mortgages in April is pushing house prices down further and lenders are tightening restrictions on loans, the Times reported.

Lenders are demanding 5 percent down for mortgages although the best deals are going to those who can afford a 25 percent down payment, the report said.

The price of homes has declined 7.7 percent since September.

Archer estimates prices could fall by 24 percent by the end of 2009, the report said.