Should I be worried about negative equity? | Home

I bought my first flat, in Chapel Market, Islington, north London, in January 1992, when I was 24 and earning £13,000 a year as a features writer on a women’s magazine. Whitney Houston was belting out I Will Always Love You and I was writing about women priests and bodycon fashion. I had never heard of negative equity.

Rising interest rates precipitated a 20 per cent fall in house prices between 1989 and 1993, leading to “the widespread emergence of a new phenomenon”, according to the University of Newcastle. That phenomenon was negative equity. The year was 1992, although it could just as easily be today, with homebuyers poised for house price drops in the face of mortgage rate rises. In March 1995 about 1.1

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