According to mortgage lenders the amount of people that are in negative equity are decreasing. Home owner that took out a mortgage in 2007 one in four where in negative equity. One in five first time buyers who still live in the property when they purchased it in 2005 where also in negative equity.
Even with house prices decreased and low equity is one reason for sharply reduce in housing transaction the amount of people in equity has reduced.
this data comes from the council of Mortgage lenders. Positive news !
“The main findings of the CML’s re-appraisal of housing equity are that:
• the number of borrowers in negative equity has declined by more than 100,000 (or 13%) since the first quarter of last year, from 827,000 to 719,000;
• the proportion of first-time buyers who have taken out loans since 2005 and are in negative equity has declined from 26% to 20%;
• around 90% of all borrowers taking out loans since 2005 hold some equity in their property, with more than half owning at least 30% of the value of the property and more than 80% holding an equity cushion of at least 10% of their home’s value.”