The house trap: negative equity is on the rise

[grumpy]

It’s a debilitating condition that will soon affect one in four Irish households. Thousands of people suffering from the disorder don’t even realise it yet. But by the end of next year, up to 350,000 families could be stricken by the disease if property prices continue to plummet, the Economic and Social Research Institute (ESRI) calculated last week.

It is negative equity, which arises when the mortgage on a property exceeds its value. And it’s contagious: once one house on your street contracts it, the spread is unavoidable. Symptoms include stress and a loss of mobility.

But for Andy Kelly, a nurse originally from Co Wexford, the condition will manifest itself most fully in his young daughter’s Dublin accent.

Kelly always dreamed of moving to the countryside once he had children but, due to the decline in the value of his home in Dublin 16, he is now effectively stuck.

“We bought a three-bed a year-and-a-half ago just before prices collapsed,” he said. “Everyone advised us to buy and, with prices increasing all the time, we thought that if we didn’t get in, we never would. After all, rent was dead money.”

timesonline.co.uk/tol/news/w … 879449.ece

[jcsmith]

And if you bought “affordable” housing you don’t even need to be in negative equity to be stuck - the clawback will do the job for you. Here’s a depressing tale from Boards.ie:
boards.ie/vbulletin/showthread.php?t=2055713420

[Puck_may_be_Famous]

How can this be happening?

I was assured that it just wasn’t possible.

“It is irresponsible to suggest that the ‘negative equity’ scenario that occurred in the late 1980’s in the UK could occur in Ireland” - Marie Hunt, Director of Research, CB Richard Ellis - Press Release 17/Apr/2007

[grace5715]

This girl got 75k from the taxpayer to purchase a house.
Her expectation was stay for 5 years, sell make a profit.
The taxpayer was the one doing all the favours.
Things have not worked out as she would have liked.
She now expects another favour.

[iPoker2]

@grumpy

“We bought a three-bed a year-and-a-half ago just before prices collapsed,” he said. “Everyone advised us to buy and, with prices increasing all the time, we thought that if we didn’t get in, we never would. After all, rent was dead money.”

Prices were increasing all the time in April 2008?

[yoganmahew]

@iPoker2

@grumpy

“We bought a three-bed a year-and-a-half ago just before prices collapsed,” he said. “Everyone advised us to buy and, with prices increasing all the time, we thought that if we didn’t get in, we never would. After all, rent was dead money.”

Prices were increasing all the time in April 2008?

Spotting points!

[grumpy]

@yoganmahew

@iPoker2

@grumpy

“We bought a three-bed a year-and-a-half ago just before prices collapsed,” he said. “Everyone advised us to buy and, with prices increasing all the time, we thought that if we didn’t get in, we never would. After all, rent was dead money.”

Prices were increasing all the time in April 2008?

Spotting points!

April 2008 being around the time that fucker Donie yacked on in the Seanad about value.