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But how do we stand now? How has the past year affected the stability of the financial market? And are we beginning to see some light at the end of the tunnel?

Lenders are beginning to lower their rates, which brings a sign of respite for borrowers, even though the lending criteria is almost unrecognisable from the deals available this time last year.

For example, 110 per cent loan-to-value deals were available one year ago, a world away from the 75 per cent LTV deals that are currently dominating the market, although it is pleasing to see some 90 per cent deals reappearing.

This type of criteria is obviously affecting first-time buyers more than any other bracket, as they are failing to set enough money aside for the huge deposits now expected of them.

Halifax house price data shows in June the average house price was £180,344. A 10 per cent deposit on a property like this would leave borrowers looking for £18,034.

Therefore, although house prices are falling, the stricter lending criteria has put these properties further out of the reach of first-time buyers, a crucial component of the property market.

In addition to this, possibly due to the increasingly expensive cost of living, savings among consumers are at an all time low.

Recent figures from Yorkshire Building Society suggest 36 per cent of consumers could only live for 11 days on their accessible savings, a very worrying prospect in such an unstable market.

As a result, we are continually hearing more about how consumers are trying to cut down on the luxuries, such as foreign holidays in order to stop outgoings exceeding incomes.

So, how much longer is this kind of doom and gloom likely to be upon us?

It is unlikely for the economic situation to pick up or stabilise until 2010; much longer than the majority of us would have anticipated this time last year.

House prices will most likely continue to fall in this period but we would expect them to begin picking up again from 2010 onwards.

In addition, learning from the lessons we have been taught in the past year, a more modest annual house price growth of 2 per cent to 4 per cent should be expected thereafter, as the previous levels of growth were unsustainable in the long run.

Of course, a possible change of government in the next year or two may well have a big impact on how the current situation works out as strong action is needed to reinvigorate the economy and the housing market.

However, in terms of a forecast for the future of the market, unfortunately, the gloom currently standing over the UK's financial activity is here for some time to come, but there is a bit of light at the end of the tunnel.

David Hill is chief executive of Stroud & Swindon Building Society