New York developments 'hit by credit crunch'

A growing number of property developments in New York are being affected by the credit crunch, it has emerged.

Research has revealed projects worth approximately $5 million (£3.44 billion) have been either delayed or cancelled due to the lack of funding available to development firms.

Stephen Blank, a researcher for non-profit group the Urban Land Institute said that "there's no way to finance a project", a view shared by developer Charles Blaichman, who has had difficulty obtaining $370 million for development projects.

"A year ago it would have seemed a reasonable amount. Not now. Even the banks who want to give us money can't," Mr Blaichman explained.

Property investors hoping to invest in the US city in the coming year may see their options limited as a result of the dwindling amounts of construction work currently taking place.

However those who have identified property for investment may find it easier to obtain mortgages to fund their purchase, following a cut in the main interest rate by the US Federal Reserve earlier this month.