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Matthew Elderfield: Homeowners and banks need to accept reality

The financial crisis has hit Irish consumers hard, none more so than homeowners.

But it's impacting different families in different ways. The steep decline in house prices affects a lot of people: 40pc of owner-occupier homeowners are in negative equity. Negative equity -- where the mortgage owed is more than the current value of the house -- can make people feel trapped, unable to move to take a new job or start a family. The Central Bank has just written to the banks to give the go-ahead on negative equity mortgages -- provided they can be afforded -- to help those who need to move and hopefully to get some transactions going in the housing market.

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