Property crisis hits 150,000

Sunday Mirror, Jul 6, 2008

AROUND 150,000 homeowners who took out mortgages this year now owe more than their property is worth.

That's one in eight of the 1.2million new buyers, according to a study by market researchers CACI.

And the figure could double by the end of the year if house prices fall by 20 per cent as some economists fear.

More than 23,000 borrowers took out 100 per cent loans in the past year, according to the Council of Mortgage Lenders. Without the cushion of a deposit, they are most at risk when property values drop.

House prices fell for the eighth month in a row in June. They are now 6.3 per cent lower than a year ago, the Nationwide revealed this week.