Home owners 'face five years of negative equity'
Some home owners could be stuck in negative equity for at least another five years as the property market struggles to bounce back, grim figures predict.
Published: 9:09AM BST 03 Aug 2009
'Getting a mortgage can be like winning the lottery,' says the NHF's chief executive Photo: PA House prices will plunge by 12.2pc this year and by a further 4.6pc next year before stabilising in 2011 with a 1.1pc rise, according to research from the National Housing Federation (NHF).
Home owners who bought during the peak of the market in 2007 are likely to be waiting until 2014 to see any profit in their properties, the figures suggest. Homes in England's North West and the east Midlands could be waiting even longer, the figures showed.
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Overall, average prices will rise by 20pc on current values to £227,800 by 2014 as values climb by 8.4pc in 2013 and 6.8pc the following year.
David Orr, the chief executive of the NHF, said: "Our new research shows that while house prices are falling in the short term they will inevitably increase in the long term because of a fundamental undersupply of housing.
"Even though house prices are falling, and are set to remain sluggish in some areas for the foreseeable future, affordability is not improving for many low-to-middle income households."
He added: "For millions of people who want a home, getting a mortgage can be like winning the lottery. First-time buyers and those wanting to buy shared-ownership properties remain victims of a deep freeze in mortgage lending.
"Until lending is freed up, young and lower-income households without access to large deposits will be locked out of the market."
According to Oxford Economics, which produced the figures for the NHF, house prices in England in 2013 will be 3pc below their pre-credit-crunch peak of 2007, but by 2014 they will be 3pc higher.
http://www.telegraph.co.uk/finance/personalfinance/5964212/Home-owners-face-five-years-of-negative-equity.html
Some home owners could be stuck in negative equity for at least another five years as the property market struggles to bounce back, grim figures predict.
Published: 9:09AM BST 03 Aug 2009
'Getting a mortgage can be like winning the lottery,' says the NHF's chief executive Photo: PA House prices will plunge by 12.2pc this year and by a further 4.6pc next year before stabilising in 2011 with a 1.1pc rise, according to research from the National Housing Federation (NHF).
Home owners who bought during the peak of the market in 2007 are likely to be waiting until 2014 to see any profit in their properties, the figures suggest. Homes in England's North West and the east Midlands could be waiting even longer, the figures showed.
Related Articles
Mortgages: borrowers denied access to rock-bottom rates
House prices are still falling
Confidence returns to housing market but growth stays slow
Housing remains the biggest problem facing the US economy
Ten ways to cut mortgage costs
Sterling falls as house price gloom deepens
Overall, average prices will rise by 20pc on current values to £227,800 by 2014 as values climb by 8.4pc in 2013 and 6.8pc the following year.
David Orr, the chief executive of the NHF, said: "Our new research shows that while house prices are falling in the short term they will inevitably increase in the long term because of a fundamental undersupply of housing.
"Even though house prices are falling, and are set to remain sluggish in some areas for the foreseeable future, affordability is not improving for many low-to-middle income households."
He added: "For millions of people who want a home, getting a mortgage can be like winning the lottery. First-time buyers and those wanting to buy shared-ownership properties remain victims of a deep freeze in mortgage lending.
"Until lending is freed up, young and lower-income households without access to large deposits will be locked out of the market."
According to Oxford Economics, which produced the figures for the NHF, house prices in England in 2013 will be 3pc below their pre-credit-crunch peak of 2007, but by 2014 they will be 3pc higher.
http://www.telegraph.co.uk/finance/personalfinance/5964212/Home-owners-face-five-years-of-negative-equity.html
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