It is always a worthwhile experience chatting to Hometrack’s Richard Donnell, there are always ideas and sparks of ideas.

Having tracked him down this morning we talked, unsurprisingly, about the weirdness of the housing market. He made one particular comment that caught my ear.

“There is no housing market,” he threw in as part of a rapid wide-ranging conversation.

Not wishing to take the comment out of context, it is worth making the point that he clearly was not suggesting that people had stopped buying and selling homes altogether. What I think he meant – and I speculate here as I didn’t stop to ask at the time – was that there wasn’t a proper functioning market.

If that is what he meant I think he has a point. Markets rely in large part on trust and confidence and at present there are huge fears among prospective buyers and sellers about making mistakes or getting caught out.

If a seller is also a buyer they must be confident that, if they take a lower price, they will be able to buy in again at an equivalent price. If the buyer is buying their first home they must be confident prices will not drop and leave them with negative equity.

This has led to a growing gap between what most buyers and most sellers think is a sensible price.

Obviously on top of this, the newly acquired lack of passion for lending among banks and building societies is acting to curb the enthusiam of those braver souls who are willing to jump into the current uncertain market.

Hometrack data, however, shows that when people are actually buying and selling there is no real sign of a collapse in prices. Obviously there will be notional bargains to be had in parts of the market such as over inflated flats originally aimed at investors.

I have no data to support this view, but I would speculate that proportionately more of today’s sales are being made by those who are comfortably enough positioned to be looking for a home and not overly focused on the investment. They aim to stay in the home for a while and so will ride out any dip in house prices, with negative equity never a real concern.

This group, however, does not constitute a real housing market. And, as is clear from yesterday’s transaction figures and from today’s release of data from the British Bankers Association, the market is slowly freezing up.

The BBA figures (BBA) show how far and how fast the number of loans for house purchase is falling.

The scary thing is that no one appears to have a clue as to when the market will return. Is it any wonder that house builders and estate agents alike are looking so dazed and confused?