20% Deposit for New Mortgages

[theskull1]

What's the problem with negative equity ?

It makes it very difficult to sell and move house.

& when remortgaging

OK possibly the better question would be....at a macroeconomic level, with ongoing wage deflation, is a period of negative equity better in the long run to get the price of housing down for the benefit of future generations?

[lynchbhoy]

Not saying negative equity is not a problem for a number of people but in general for the vast majority it isn't. It can be a problem in the events as outlined-
But in such events it is the last resort to have to sell a house - as rent will cost as much as a mortgage repayment.
I know the banks have been ( and are ) wnakers to poor folk who have lost jobs are in the worst predicament of having no job, negative equity and can't afford mortgage ( or rent)
But
This number of people are a small percentage

Negative equity is not a problem for the vast majority of people. Rent and mortgage repayments aren't that far apart for most.
I suppose this highlights how import and jobs are to us, and how legislation and the behaviour of the banks are disgraceful and both deserve to be ousted ( or we should all move to a new bank(s) if any opened).

[seafoid]

Not saying negative equity is not a problem for a number of people but in general for the vast majority it isn't. It can be a problem in the events as outlined-
But in such events it is the last resort to have to sell a house - as rent will cost as much as a mortgage repayment.
I know the banks have been ( and are ) wnakers to poor folk who have lost jobs are in the worst predicament of having no job, negative equity and can't afford mortgage ( or rent)
But
This number of people are a small percentage

Negative equity is not a problem for the vast majority of people. Rent and mortgage repayments aren't that far apart for most.
I suppose this highlights how import and jobs are to us, and how legislation and the behaviour of the banks are disgraceful and both deserve to be ousted ( or we should all move to a new bank(s) if any opened).

20% of mortgages are in arrears, the vast majority for people below 45, a huge proportion of first time buyers from say 2000 to 2007
Older people eg their parents have great equity because they were not buying when the risk was highest.
So the percentage of FTBs in Neg equity for 2005 could actually be 40%
And that is not trivial.

http://irelandafternama.wordpress.com/2014/01/29/the-geographical-distribution-of-negative-equity-of-post-2001-built-residences-in-ireland/

A lot of the problems are in the commuter towns outside Dublin. People who couldn't afford to live in Dublin or locals who were priced to their limits by people who couldn't afford to live in Dublin.
Negative Equity has ruined more than a few marriages .   

[lynchbhoy]

The key is employment and continued employment .
Employment has massively risen and many if not most defaulters are now earning.
The problem is still that they are at the mercy of the banks who despite being shown mercy themselves - are not passing this on- yet!

We should be giving out the Japanese model of longer term mortgages for these people.
But I still don't see this as a problem apart from the minority of individuals. I believe arrears stats contain mostly second homes.

[seafoid]

The key is employment and continued employment .
Employment has massively risen and many if not most defaulters are now earning.
The problem is still that they are at the mercy of the banks who despite being shown mercy themselves - are not passing this on- yet!

We should be giving out the Japanese model of longer term mortgages for these people.
But I still don't see this as a problem apart from the minority of individuals. I believe arrears stats contain mostly second homes.

The key is employment and decent pay rises.
If pay rises are lower going forward than they were in the tiger years then house prices are too high.

[muppet]

Not saying negative equity is not a problem for a number of people but in general for the vast majority it isn't. It can be a problem in the events as outlined-
But in such events it is the last resort to have to sell a house - as rent will cost as much as a mortgage repayment.
I know the banks have been ( and are ) wnakers to poor folk who have lost jobs are in the worst predicament of having no job, negative equity and can't afford mortgage ( or rent)
But
This number of people are a small percentage

Negative equity is not a problem for the vast majority of people. Rent and mortgage repayments aren't that far apart for most.
I suppose this highlights how import and jobs are to us, and how legislation and the behaviour of the banks are disgraceful and both deserve to be ousted ( or we should all move to a new bank(s) if any opened).

LB negative equity isn't a problem for individuals until they either can't pay, or have to sell.

However vast numbers of earners, in good jobs, being in negative equity is very bad for the economy. In normal times these people would be expected to spend, but most will hoard their cash if they are in negative equity.

[lynchbhoy]

The key is employment and continued employment .
Employment has massively risen and many if not most defaulters are now earning.
The problem is still that they are at the mercy of the banks who despite being shown mercy themselves - are not passing this on- yet!

We should be giving out the Japanese model of longer term mortgages for these people.
But I still don't see this as a problem apart from the minority of individuals. I believe arrears stats contain mostly second homes.

The key is employment and decent pay rises.
If pay rises are lower going forward than they were in the tiger years then house prices are too high.

Fully agree
Even before that though is people getting jobs, then decent paying jobs - then look at pay rises etc

Eg the former construction workers ( I know plenty and I'm sure most of us do)

I heard during the week that as our economy is supposedly starting to rise up again- the new nickname is the 'Celtic Phoenix ' !!!

Ffs

[lynchbhoy]

Not saying negative equity is not a problem for a number of people but in general for the vast majority it isn't. It can be a problem in the events as outlined-
But in such events it is the last resort to have to sell a house - as rent will cost as much as a mortgage repayment.
I know the banks have been ( and are ) wnakers to poor folk who have lost jobs are in the worst predicament of having no job, negative equity and can't afford mortgage ( or rent)
But
This number of people are a small percentage

Negative equity is not a problem for the vast majority of people. Rent and mortgage repayments aren't that far apart for most.
I suppose this highlights how import and jobs are to us, and how legislation and the behaviour of the banks are disgraceful and both deserve to be ousted ( or we should all move to a new bank(s) if any opened).

LB negative equity isn't a problem for individuals until they either can't pay, or have to sell.

However vast numbers of earners, in good jobs, being in negative equity is very bad for the economy. In normal times these people would be expected to spend, but most will hoard their cash if they are in negative equity.

Yeah I understand and mostly agree
But while it affects a small enough number - that's no consolation when you are one of them

Also people will spend when they have to

Town/shops/pubs/restaurants in Dublin at least seem to be booming - so economy going well there.
Not do sure about down and up the country

[muppet]

Not saying negative equity is not a problem for a number of people but in general for the vast majority it isn't. It can be a problem in the events as outlined-
But in such events it is the last resort to have to sell a house - as rent will cost as much as a mortgage repayment.
I know the banks have been ( and are ) wnakers to poor folk who have lost jobs are in the worst predicament of having no job, negative equity and can't afford mortgage ( or rent)
But
This number of people are a small percentage

Negative equity is not a problem for the vast majority of people. Rent and mortgage repayments aren't that far apart for most.
I suppose this highlights how import and jobs are to us, and how legislation and the behaviour of the banks are disgraceful and both deserve to be ousted ( or we should all move to a new bank(s) if any opened).

LB negative equity isn't a problem for individuals until they either can't pay, or have to sell.

However vast numbers of earners, in good jobs, being in negative equity is very bad for the economy. In normal times these people would be expected to spend, but most will hoard their cash if they are in negative equity.

Yeah I understand and mostly agree
But while it affects a small enough number - that's no consolation when you are one of them

Also people will spend when they have to

Town/shops/pubs/restaurants in Dublin at least seem to be booming - so economy going well there.
Not do sure about down and up the country

i am one of them. 

[seafoid]

It's not a small number

"Up to 300,000 households are in negative equity, 100,000 home owners can't meet their payments, and many others are trapped by tracker mortgages. "

One of the big features of the post crash landscape is intergenerational inequality.
Many of  our parents are doing ok while we ourselves or siblings may have lost jobs, have gone into negative equity, got no pay rises, had to accept lower salary or had to emigrate. The cost of adjustment has been borne mostly by younger people.
Buying a house now with the state of the global economy and the IMF warning that we'll never get back to the growth rates pre Lehman- it may be like taking part in a Ponzi scheme.

People are not educated to consider financial risk.

[lynchbhoy]

Afaik a large proportion of those figures are second homes!?!

[seafoid]

Afaik a large proportion of those figures are second homes!?!

Give us a few numbers. Even if half are BTL there's 150K in NE .
Out of 1m mortgages. 

[lynchbhoy]

Afaik a large proportion of those figures are second homes!?!

Give us a few numbers. Even if half are BTL there's 150K in NE .
Out of 1m mortgages.

Don't recall where I heard it
But
Even going by the figures you mention
The number of people in actual difficulty while having negative equity in primary residential homes is what?