Property News · March 10, 2013

Trapped in negative equity with nowhere to go


Negative equity and a dearth of first-time buyers have trapped many families wanting to upgrade to a bigger homeTom Green and his wife, Keira, bought a flat in Solihull, near Birmingham, in February 2008 as the property market reached its peak. “We took on a 125% mortgage from Northern Rock – at that time it was sold as ‘your property will increase in value, so it’s no problem’,” he says. However, just a couple of months later the market collapsed. “It’s a big flat and there were just the two of us, so we decided to stay put and wait it out. We thought after a couple of years things would pick up,” he says.Instead, five years on, Tom Green thinks it is still worth less than the £122,500 they paid. They have watched as the neighbourhood has become less desirable and nearby properties have hung around on the market for years. “There are no first-time buyers left – they’ve all vanished, certainly at the level we want to sell at.” Continue reading…

Source : theguardian.com
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