The latest transaction figures from HM Revenue & Customs underline the industry fears of a collapse in home sales.

They show that sales of property worth more than £40,000 have fallen by more than a third since the credit crunch hit. This May’s figure of 98,000 transactions compares with 155,000 last year.

But more worrying is the shape of the trend. It looks linear and stongly down with an average drop of more than 4,000 transaction a month. It may be speculative, but if that rate continues the monthly transactions figures at the end of this year will be about half that of a year earlier.

And the figures showing buyers and sellers holding very different views of price, suggests that the trend may well be set, unless there is a significant turn in the market.

The problems of falling property sales, however, don’t stop with the housing market.

Falling house sales, obviously poses a further problem for smaller construction firms, as it means less in the way of “doing up” houses.

But also it reduces the tax take from stamp duty and further squeezes the already pressured public purse.

The tax take pencilled in for 2008/9 from stamp duty is put at £13.5 billion, a shade down on the previous year.

About 70% of stamp duty currently comes from land and property sales with the rest from shares etc. And about half – £6.4 billion in 2006/7 – is attributed to sale of homes.

With property transactions likely to be down at least a third in the coming financial year, the sum pencilled in by Government looks a bit optimistic.

How will the Government fill that gap – slow spending on things that are not too obvious maybe, like ,say, construction?