The solution is for lenders to become much more profitable. This will encourage more money to be made available. Cut bank rate by 2% now and leave the borrowing rates where they are. Money will flow in.

Brian Anderson, Edinburgh,

Basically - the value of our assets have doubled - with no real growth to justify it.

We have borrowed on that growth, and have squandered the money.

It's a bit like when the bank puts money in an idiots account by mistake - and they go on a spending spree.

Sooner or later you have to pay.

jeremy, hassocks, sussex

Problem - Bankers created fake money using deceptive financial alchemy. This so called 'financial innovation' has been exposed as a scam

Solution - We will have to go back to creating the ability to borrow thro' hard work and savings. This will be a shock to many and will take time to sink in

Chris , Haslemere, UK

Our problem is modern banking has very effectively killed off the one thing that created stable long term investment. Is it too much to ask where the funding for the creation of new jobs is going to come from? We need a return to the now "old fashioned" culture of savings and investment in industry.

Chris Coles, Medstead, Alton, United Kingdom

Rom, Oxford. Japan is not a recent lesson. The situations are not comparable in any economic sense. There is no logic in citing it with regards to a 70% drop - indeed if there was a true economic link the drop would be rather larger.

Ann, London,

When will the British people realise you that don't need to own your own house. In fact where is the logic in straddling oneself with crippling debts for life, then died or the DHSS takes your house .
Force the Government to build Council houses, pay their rent and use the £1000/mt u save

Brendan Breen, Omagh, Ireland

Where will the £40bn p.a. come from? The UK government is going to have to borrow a lot more as tax revenues fall and unemployment rises. People are finding it harder to save as food, fuel and C Tax rise. And foreigners have enough of our debt already.
Interest rates will rise.........

N Reed, Truro, UK

It's not just mortgage costs: power and fuel prices are rocketing, and food and the rest, and soon unemployment. If it was only mortgage costs, no huge problem, but people are crushed from all sides and if significant numbers get reposessed there will be trouble.

Richard, Ipswich, UK

Why should the government intervene. Lots of people thought they were making a one-way bet on property. They re-mortgaged to fund their consumer greed, pricing others out of the market meanwhile. Now things look less rosy so they go crying to the government. You make your own bed. Sleep in it.

Quentin, Shanghai,

So what will happen to those people who lose their jobs and need to sell their homes? With banks not lending there will be few buyers, that can mean only one thing repossessions. something must be done now before its too late. The banking sector is a shameful disgrace. Government must intervene.

david hambly, St Albans, uk

In Canada the 40 year mortgage was QUICKLY removed having only been on the shelf for a few months. Back now to 25 year standards - has the UK removed its 52 year mortgage that I recall was with TESCO. This mortgage was backed by high street lenders.

Think about who is ultimately to blame!

Paul, London, Canada

if saving was encouraged and became a national habit, there would be money to lend.so encourage mutual building societies and keep them mutual by lawand keep moneybags away from them- make them have a rule, no loan without 2 years' regular saving

peter c, devizes, wessex

About 15 the retiring head of Lloyds Bank said, "t he problem with Banking was that there was too many banks chasing insufficient business, to sustain them all" or words to that effect.

That comment was probably the best advice any banker could give and the same is true today.

Chris, Salisbury,

The problem was a sustained period of irrational exuberance in the UK over the past 10yrs. The Government allowed it to happen; the banks encouraged it and the public naively accepted it. A painful correction is now unavoidable. There is no quick & easy fix. The damage is done: pain is unavoidable.

James Emanuel, London, England

Re £40 billion pa of additional funding for the next three years for existing commitments, one presumes at the point of lending the banks found the funding to make the mortgage advance. So apart from funding defaults what is £40 billion for ?

Fred, Bridgwater, UK

Francis,

Why is it positive to help house prices rise further ? Would you like more expensive cars and kitchen appliances too ?.

Michael Reid, Northampton, UK

The report is wrong. Anyone with a job and 10% deposit can easily get a mortgage of more than four times salary.
The reason people are not buying is because houses are too expensive,Banks have lent too much and put prices up.They are the guilty ones.

Why use tax payers' money to keep prices up ?

Michael Reid, Northampton, UK

What a shame successive governments have made it so easy to raise money for a home. Thirty years ago it was two and a half times one income. If that had remained the standard I wonder where house prices would be today?
Who has profited? Estate agencies, banks and lawyers. Not us!

charles Watson, funchal, madeira

Now is the time to temporarily remove stamp duty for UK property transactions. The Treasury state that Stamp duty is an important source of revenue, but its pretty useless right now. Sir James Crosbys report does nothing for the property market, but lay on more gloom. Think POSITIVELY for a change

Francis Henderson, Arundel, UK

wow - the doom-mongers are having their best year ever - the 'well I think it'll be EVEN worse than that' (70% indeed!). There is something about the British psychie that loves dark clouds and wants more ...

richard sullivan, Chislhurst, Kent

Sir James's report sounds like an actual attempt at honesty and realism. Could he run for office in the United States? We don't have any of either, but we love imports.

Walter, East Hampton, U.S.A.

only 3 years, your joking, what is the solution, people with high debts cannot repay them when they are unemployed ?

What is the solution ? is there 1 ? Where do the dehoused people
, children and pets go to ? We cannot live in the streets in a British winter.

Peter Hollidai, ratoath, Ireland

Sir James's assessment is based on current conditions. Add in still to come rising unemployment, rising private loan / card defaults, rising corporate Non Performing Loans and falling Sterling as a result of the encroaching recession and the prices drop will be around 70%. Japan is a recent lesson.

Rom, Oxford,

Here's something the MSM won't tell you. In a private U.S. Federal Reserve report, the prediction is that the S&P (Standard and Poors) will drop 500 points within the next year. Which is roughly half the current value.

Tom, Kansas City, US