Living in era of negative equity
ONE in three mortgage holders could be in negative equity, the dismal situation in which the mortgage exceeds the value of the property, by the end of this year. The number of households affected could reach 196,000.
And if prices continue to decline, falling by a 50pc from the peak of 2006, as widely forecast, the figures could become even more frightening. Dr David Duffy of the Economic and Social Research Institute estimates that as many as 350,000 homeowners could find themselves in negative equity.
If even the mildest of these projections comes true, the effects will be shattering. One in 10 of the mortgage holders affected could default. Others will fall into serious arrears. Still others will find themselves unable to move house if they lose their jobs or their marriage collapses.