In the past eight weeks alone, property firm GVA Grimley has been appointed to recover more than £16.9m secured against both residential and commercial property, according to the firm's Leeds-based senior director.

An estimated £6.8m of that total relates to properties across the North of England being handled through the firm's Leeds office.

The company's insolvency department has been appointed as Law of Property Act (LPA) receivers by many leading high street banks and other money lenders.

Andrew Rodger, Leeds-based senior director and LPA receiver at GVA Grimley, explained: "Just 12 months ago we were reporting a buoyant property market and huge demand for both development and investment opportunities, but caution for the future.

"A year later and the credit squeeze is tightening and casualties are emerging.

"We're now finding that high levels of mortgage fraud has occurred across both the residential and commercial sectors.

"In many of the cases being uncovered, properties have been overvalued by creating bogus leases that show the property to have artificially high rental value or by ignoring ongoing costs such as repairs and maintenance.

"In a rising market, the property's value will soon catch up with the fraudulent valuation but when the market dips, as it is doing now, these types of cases begin to emerge as buyers find themselves in negative equity and struggle to meet mortgage repayments.

"The problem has been fuelled further by a high number of inexperienced lenders entering the market during the boom time that operated with a lack of prudence as they competed for market share.

"We're seeing countless cases where lenders didn't insist on seeing new home warranties and where there was no guarantee of quality workmanship."

He warned that those exposed to the residential market would be hit the hardest.

Prices were already falling and the reduction in new home sales was leading to reduced building activity and mothballed sites.

Figures obtained by the YEP have shown that of the 12,700 apartments in the planning pipeline at the beginning of last year, 7,170 units have been axed or mothballed.

That means 4,250 flats delayed or ditched in addition to high-profile schemes which have recently fallen victim to the credit crunch including Spiracle, on the site of the Leeds International Pool, the Kissing Towers, off Sovereign Street, and Wellington Street's Lumiere.

But Mr Rodger said that housing demand will continue to exceed supply.