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New statistics from Halifax have brought forward great news for homeowners with bad credit who are trying to keep up with payments.

When combined annual housing costs across England, which included mortgage interest costs and household bills, in the beginning of the 2008 financial year were slashed by 17%. The fall recorded by the statistics from the High Street Bank, now part of the Lloyds Group, accounts for an amazing £1,468 more into the pockets of the consumer.

The deductions in mortgage interest costs vary from region to region. Surprisingly, one of the places which were affected best by the “green shoot” of falling housing costs was the capital. London housing costs have been in freefall by £2,391 over the past year, falling below the five-figure mark comfortably at over £9,000 for the first time in a while.

Finance experts say that the fall in mortgage interest rates can only be excellent news for consumers. Statistics have been backed up by figures which confirm the decrease in payable interest even offset significant rises in gas and electricity bills over recent months.

The new statistics have not gone through without controversy, however. The Land Registry has observed a rise in house price which has caused some confusion as to how housing costs could generally be down. Taking both studies into account, there are many optimistic financiers who now believe that the property market is beginning to level out.

A stable property market could be beneficial to people from all walks of life. Some people with a bad credit rating have been struggling to keep up-to-date with mortgage repayments and ward off any threats of repossession. It is hoped that the reduction in mortgage interest could give new hope to thousands of families who have been hit hard by the recession, particularly if they are on tracker mortgages.

People with bad credit ratings are already being supported by new schemes by the Government to make home repossession a final option. Currently, there are calls for lenders and banks to become more lenient on the volume of court orders it makes for charging orders. There are accusations that criteria outlined as legal safeguards for the discerning homeowner are not being taken into consideration fully – resulting in calls for a review of the current system.

There are hopes that the introduction of new consumers trying to get a foot on the property ladder. As more competitive mortgage rates make borrowing a more feasible option and the banks begin to offer consumers more options, there are hopes that the property market is yet to come out fighting.

As it stands though, things are still looking rather bleak. Even though the places to be are in the cities like Manchester and London if you are looking for the steepest cuts in mortgage interest rates, the amount of people taking out new mortgages remains frightfully low in comparison with other years. Completed mortgage transactions have totalled at 33,000 according to figures from March this year. This figure is nearly half of March 2008, which in turn was approximately half of the figures seen in March 2007 – at over 100,000.