900,000 homeowners have negative equity due to falling house prices, according to a report from The Guardian.
The latest data from the Council of Mortgage Lenders reveals that one in ten owner-occupiers are in negative equity, compared to those in East Anglia and Scotland where it is one in 100. This estimate compares with 1.5 million homeowners who are still feeling the impact of the early 90s housing market crash.
While those in negative equity only face ?modest shortfalls? of less than 10 per cent of their property?s value, it?s been said that the property market is in ?a substantial downturn, with few indications that we have reached the bottom yet?.
Research by James Tatch, senior statistician at the CML, suggests that 4.8 per cent of all UK homeowners are facing negative equity. He explained that 903,000 homeowners got into some negative equity when they took out their mortgage between early 2003 and 2008. Those most affected are people who bought their homes at peak of the property boom that happened during spring and summer 2007.
The CML?s regional breakdown shows that an estimated 9.2 per cent of the north of England?s 749,000 homeowners ? which makes it 69,000 ? are in negative equity. In Greater London, 119,000 are in negative equity, while East Anglia and Scotland have 16,000 in negative equity.
If there is some consolation, it has been said that the problem was less focused on young first-time buyers and was more evenly spread across age groups.
