The shadow chancellor has claimed that the latest mortgage statistics from the Bank of England prove that the government's policies are "not working".
Mortgage approvals dropped 13 percent in November to reach 27,000, leading the Conservatives to criticise the government.
Despite the Bank of England slashing interest rates over the last few months and the government introducing a stamp duty holiday, the Bank revealed that approvals were at their lowest level since the Bank of England began recording the series in 1999. While lending in cash terms increased by £477 million during the month to reach £740 million, it was still at less than a tenth of the level recorded a year before.
These figures were used in an attack by the shadow chancellor George Osborne, who also claimed that the government's VAT reduction had failed to help retailers.
"First we discovered that there were fewer shoppers in December despite the VAT cut; now we discover house prices are falling sharply and mortgage approvals at a record low despite the stamp duty holiday introduced three months ago," he said. "The new year shows that Gordon Brown's policies are not working and the recession is getting worse not better."
However, according to the Building Societies Association, there are signs that the decline in the property market may be slowing. It recorded gross mortgage lending as being at £2,595 million for November, down from £4,070 a year before.
But its director general Adrian Coles said: "It is encouraging to note that after the negative net advances figures in the summer the last three months have seen positive figures which suggests perhaps that the market is not deteriorating even further."
