Negative equity is rising as property prices cool
Falling property prices can push recent buyers into negative equity, but the risk is concentrated among highly leveraged owners who need to sell during a downturn.
Only 1 per cent of homeowners are in the red when it comes to equity in their property but that figure could rise markedly if property prices keep sliding. (Image source: Garun .Prdt/Shutterstock.com)
Negative equity is a term we hear popping up in the mainstream media a lot at the moment but is it something investors and property owners really need to worry about?
For most owners the answer is no.
Negative equity occurs when you owe more on your home loan than the property is worth, usually as a result of property price declines.
It makes a good headline as property price growth cools and doomsayer predictions about property prices plummet…
