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Borrowers emerging from negative equity

1st November 2012 | back to article listings BACK    print this article PRINT

The amount of people in negative equity has fallen by almost 15% in the last 18 months, according to the Council of Mortgage Lenders (CML).

Negative equity, where the balance of a borrower's mortgage is more than the value of their house, is now affecting 100,000 fewer people than a year and a half ago.

In the first three months of 2011, the CML identified 827,000 borrowers from the previous six years who were thought to be in negative equity. Now the number of borrowers who took out loans from 2005 onwards and are in negative equity stands at 719,000.

Recent rises in the cost of UK property are thought to be partially responsible for the change, but the housing market is still subdued and average prices remain below their peak value in many areas.

In September, sales figures from the Land Registry revealed the biggest increase in house prices in almost two years. Most of the rise was attributed to increases in London and the south of England however.

Copyright Press Association 2012

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