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13 Billion euro in Negative Equity

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  • 06-08-2009 10:16pm
    #1
    Joey the lips
    Registered Users Posts: 10,262 ✭✭✭✭


    Just watching primetime. If houses fall another 20% as expected the amount of negative equaty in the economy will rise from 8 billion now to 13 billion.

    Jesus this figure is enough to scare the sh1t out of anyone and makes me think that we are the last generation for a long time that will own our own homes. Provided we can hang on to them

    The courts are overwhelemed at the moment people are being taken to court for money they dont have

    Many who bought there houses had the 3 point plan

    Get the house

    Get married

    Have kids


    Most will not make it past get the house.


    Is this a symptom of our own doing or is it a global factor that has events beyond our control. My real reason for writing. 13 Billion in negative equity


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    #2
    astrofool
    Registered Users Posts: 16,699 ✭✭✭✭astrofool


    Negative equity will only affect someone if they want to move house or switch mortgage provider. Unless they bought an unsuitable property, being in negative equity makes as much difference as being a paper millionaire.


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    #3
    Joey the lips
    Registered Users Posts: 10,262 ✭✭✭✭Joey the lips


    astrofool wrote: »
    Negative equity will only affect someone if they want to move house or switch mortgage provider. Unless they bought an unsuitable property, being in negative equity makes as much difference as being a paper millionaire.

    And of course if you loose your job. Most insurance is only on one person


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    #4
    jimmycrackcorm
    Registered Users Posts: 14,339 ✭✭✭✭jimmycrackcorm


    I don't know what is different for people in "negative Equity" now compared to two years ago. It's the equivalent to how we felt about how rich we were with the positive equity. Neither matter when you still have to live in the gaffe.


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    #5
    Riskymove
    Registered Users Posts: 10,888 ✭✭✭✭Riskymove


    astrofool wrote: »
    Negative equity will only affect someone if they want to move house or switch mortgage provider. Unless they bought an unsuitable property, being in negative equity makes as much difference as being a paper millionaire.

    exactly...the real problem now is how some people simply cannot afford a mortgage having been stretched to the limit before losing a job or reduced income

    thats the real legacy of the property panic and 100% mortgages etc


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    #6
    marco_polo
    Moderators, Science, Health & Environment Moderators Posts: 10,079 Mod ✭✭✭✭marco_polo


    Riskymove wrote: »
    exactly...the real problem now is how some people simply cannot afford a mortgage having been stretched to the limit before losing a job or reduced income

    thats the real legacy of the property panic and 100% mortgages etc

    I agree, it is a scandal that many people were given morgages that they could barely afford even at the time.

    However I must add that as big a part as the banks played, I have little sympathy for the 'Sure they were giving money away, what else was I supposed to do' line of defense. People need to accept responsibility for their own financial actions as well, if you are paying out nearly half your income on a morgage it is not rocket science to foresee potential problems down the line if things get tougher.


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    #7
    Cuddlesworth
    Registered Users Posts: 13,995 ✭✭✭✭Cuddlesworth


    People this has really effected.

    People buying a house. :)
    People selling a house :(
    People moving house :confused:


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    #8
    SkepticOne
    Closed Accounts Posts: 6,718 ✭✭✭SkepticOne


    Joey the lips wrote: »
    Just watching primetime. If houses fall another 20% as expected the amount of negative equaty in the economy will rise from 8 billion now to 13 billion.

    Jesus this figure is enough to scare the sh1t out of anyone and makes me think that we are the last generation for a long time that will own our own homes.
    But much lower prices are what is necessary for others to buy homes. They had been far too high in the past and this either prevented people from buying or forced them to take massive loans that are now in negative equity. What we are seeing is the correction of that problem. I think there has to be much more than a 20% fall for the full benefit to be seen though.


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    #9
    astrofool
    Registered Users Posts: 16,699 ✭✭✭✭astrofool


    Cuddlesworth wrote: »
    People this has really effected.

    People buying a house. :)
    People selling a house :(
    People moving house :confused:

    *if they bought during the height of the bubble, and have not being paying off their principle.

    If someone bought their house prior to 2004, or in the last year or so, paid a decent size deposit, and has been paying off the principle, then they should not be in negative equity at the moment.

    People moving house if trading up could be saving money, even if in negative equity, if they can get the bank to allow them to bridge the mortgage to the new propery.


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