Homeowners fear negative equity
Tuesday 27th January 2009, 12:00PM GMT.
A quarter of UK mortgage holders are concerned about negative equity as house prices continue to plunge.
A study from Fairinvestment.co.uk found 25 per cent of mortgage holders in the UK are worried the value of their home will drop below the loan secured on it.
Of the 25 per cent, 11 per cent said they bought their home at the height of the property boom, leading to concerns about their position.
Sharon Bratley, chartered financial planner at Fairinvestment.co.uk, said: “Our results show that as house prices continue to fall, a large number of mortgage holders are becoming worried about their position.
“This is on top of the fact that mortgage rates are slow to fall and repossessions are on the up.
“The government has tried to relieve this added stress for homeowners, but it is clear that more needs to be done before house prices fall further and push more people to worry about negative equity.”
However, 27 per cent of people questioned in the survey said that as long as they can pay the mortgage they are not concerned about negative equity.
In addition, 29 per cent of homeowners said that because they bought their homes before the property boom, they are not worried, while 16 per cent remain unconcerned as they believe that house prices will stabilise again.
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