• Home loan approvals slump 70% in a year
• Repossessions soar by 300%
• Estate agents report dramatic fall in home sales
• Ratesetter voted to INCREASE interest rates, BOE minutes show

Britain's housing market took a fresh battering today as new figures revealed the number of homes sold has halved in the past year while the number of home loans approved last month fell by a staggering 66.9 per cent.

Coming alongside evidence of the soaring number of repossessions, the news lays bare the extent of the meltdown in the housing market.

Just 21,118 loans were approved for people buying a property in June - a 23 per cent slump from May's figures and a 66.9 per cent year-on-year fall, according to the British Bankers' Association.

In June last year, 140,000 homes were sold for £40,000 or more. This was before the Northern Rock debacle began and the words 'credit crunch' were bandied about.

Freefall: The number of homes sold has halved in a year, according to new figures

Twelve months later, figures from HM Revenue and Customs show that just 77,000 homes were sold in June, the lowest number since records began in 2005.

Despite the problems faced by many homeowners, one rate setter voted to increase interest rates at last month's Bank of England monetary policy committee in a bid to curb rampant inflation.

In a sign of mounting pressure on policymakers to raise the cost of borrowing, monetary policy committee member Tim Besley voted for a 0.25 per cent increase in interest rates.

However, many potential buyers are being put off by the difficulty in getting a mortgage, while others are scared away by predictions that house prices could fall 35 per cent by the end of 2010.

The scale of the collapse is alarming, and is a nightmare for families who need to sell but cannot find a buyer.

Howard Archer, chief UK economist at the consultancy Global Insight, said: 'The bad news on the housing market currently remains relentless, with very low housing market activity being a consequence of the toxic mix of stretched buyer affordability and extremely tight lending conditions.' 

Separate figures, from the auction experts Essential Information Group, reveal that the number of repossessed properties coming up for sale in auction houses has rocketed nearly 300 per cent in three years.

Between January and June, 3,115 repossessed homes went under the hammer in Britain, compared with just 799 in the same period during 2005.

The scale of the increase is extraordinary, with the numbers soaring 66 per cent over the last year alone from just 1,873 in 2007.

Experts have been warning that repossessions will soar but this is the first concrete evidence.

David Sandeman, managing director of Essential Information Group, said: 'Repossessions now make up over one in five of the properties on sale at auction.'

Official repossession figures from the first half of the year, from the Council of Mortgage Lenders, will not be published until August.

But the CML predicts repossessions will rise sharply this year from 27,100 last year to 45,000 this year, equal to nearly 125 families every day.

Repossession can have devastating consequences on families who lose their homes.

It can lead to depression, divorce and an agonising disruption to children's lives who often have to move schools and lose touch with friends.

These days, it is becoming a reality for more families as inflation-busting rises in household bills and mortgage payments cripple their finances.

The number of families who are 'getting by' but describe their finances as 'pretty tight', has jumped according to the research firm Mintel.

In 2006, 25 per cent said they were only just surviving but this has jumped to around 40 per cent, its report reveals today.

Other figures, published yesterday by the National Association of Estate Agents, confirm the crisis facing anyone who needs to sell their home, particularly if they are in a rush.

Last month, estate agents sold an average of just six homes, which has more than halved from an average of 13 in the same month last year. One estate agent from the North East described the first half of this year as 'a complete disaster', adding: 'I can't see any light at the end of the tunnel.'

One from Devon said: 'Transactions are down around 60 per cent which has sent shivers down the spine.'

He said there were signs of a slight improvement over the last week with 'an increasing perception' that prices 'will not fall for ever'.

Several agents said buyers are so nervous that they are regularly getting 'cold feet' on the day that contracts are due to be exchanged.