ONE of Britain’s biggest housebuilders, Taylor Wimpey, has halted acquisition of development land amid growing fears about the health of the housing market.

City sources said it decided to freeze land purchases in mid-October and has been out of the market since mid-November. It is thought the only purchases completed were those to which it was committed before October.

Taylor Wimpey rivals Barratt and Persimmon are also said to have slowed down acquisitions of land. Sources close to both say they were being “very selective” about new deals.

Sales of new homes have slowed sharply since the autumn and housebuilders are nervous about prospects for next year.

Figures from the Council of Mortgage Lenders showed gross lending fell to £30.7 billion last month, down from £33.5 billion in October and £33.2 billion in November last year. Meanwhile, Halifax and Nationwide each reported a steep fall in house prices last month.

Economists predict that a combination of flagging consumer sentiment, slowing economic growth and lack of affordable housing are likely to mean that the market stagnates next year with prices expected to be virtually unchanged a year from now.

But Martin Ellis, chief economist at the Halifax, one of the largest mortgage lenders, insists that strong fundamentals – including a shortage of supply and high employment levels – will underpin demand next year.

Further interest-rate cuts are also expected to spur demand.

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