Realistic - will anything be done about negative equity

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qs222

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Being realistic do ye think anything will be done about negative equity?

I know we are not alone but we have 2 houses in negative equity (reluctant landlord on one). All we wanted was to do the best for ourselves and we are now stuck in a 2-bed house (v nice and love the location). We now have a baby and are completely stuck where we are.

I'm not looking to get away from the debt that we borrowed and are responsible for but I hate this feeling of being trapped and not being able to choose to have a second baby in the future because of decisions we made with the best of intentions for our future.

Hindsight is great and yes we should have thought about 2 bed etc... but at the time we were trying to live in a nice area within an easy commute of work and its all we could afford.
 
ClubMan said:
What does this mean?

Bought 2nd house and sale of 1st house fell through, then could not sell so had to rent i.e. I do not want to be a landlord if I could sell the property and clear the debt I would but I cannot.

So what are you looking for then?
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To not feel like I have no control over where I can live. To escape from feeling trapped. To no longer have a noose of negative equity around my neck. To be able to make decisions for the future for our family. Clubman, you obviously are not in negative equity because that is not a question you would have to ask if you were.
 
I can sympathise with qs222. I have one property in serious negative equity and pyrite so you would have to wonder what the value is at all. It is not a nice feeling. We also feel trapped, we thought we were buying as a stepping stone as our parents did or to get on the so called "property ladder". The reality is we would of been better bumming it for the last ten years rather than killing ourselves to get somewhere. Its a horrible feeling and made worse when your family is starting to expand. People may say sure years ago they had to fit 10 kids in a room. That may be but were both parents out working to pay the mortgage ? - I doubt it. We are in a terrible mess in this country. Some are a lot worse off than others. Some got lucky, others not. I have no answer for you sorry - just a rant.
 
qs222 said:
To not feel like I have no control over where I can live. To escape from feeling trapped. To no longer have a noose of negative equity around my neck. To be able to make decisions for the future for our family. Clubman, you obviously are not in negative equity because that is not a question you would have to ask if you were.
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What specifically are you looking for to be done to address these issues?

My situation is irrelevant to your post looking for feedback/comment on this issue...
 
My sympathies go out to younger people caught in this negative equity trap. What is particularly annoying is that these people are not trying to avoid paying their loans, and that they are stuck in places where it is difficult/impossible to raise a family .

Ireland -like all European states - needs children and it is amazing that there is no govnt action to aid this problem that unless solved will adversely affect the nation - less children being born, more young people emigrating and for those who remain,childless and in cramped accommodation ,a never-ending feeling of despair.

Having said all this - have either of you (qs and pyrite) approached your lender or a mortgage broker and asked if you could transfer mortgage to another property assuming that you could get a bigger place for a few grand more?
E.G.your home is worth 150k but you owe 300k. A bigger home is available for 200k. Can you please, Mr Lender, let us sell the small place and give us 50k more ?

The bank will probably say no but if you told them that you would stop paying altogether and they could have the keys back because your only alternative is to emigrate maybe they would re-consider.

In the meantime I'd start opening a small account in another bank and build up a reasonable credit rating -credit cards etc.
 
I would email merkel that question.

But in all seriously it seems if nothing drastically changes within governement legislations on this matter, this is going to be an ongoing problem for my lifetime at least.
 
People may say sure years ago they had to fit 10 kids in a room. That may be but were both parents out working to pay the mortgage ? - I doubt it.
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What's the relevance of whether both parents were working ? (honest question btw). I think ten kids to a room is over pushing it but I really don't see why families of three or four can't live in a three bedroom house either.
 
elcato said:
What's the relevance of whether both parents were working ? (honest question btw). I think ten kids to a room is over pushing it but I really don't see why families of three or four can't live in a three bedroom house either.
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Cost of childcare maybe?

I empathise totally on the NE issue. Im married a couple of years and stuck in a tiny 2 bed apartment thats worth half what I paid for it. I couldnt afford anything more at the time and rent was more expensive than my mortgage repayments. Its ok for now, we dont want to have children which is lucky i suppose because if we did we simply couldnt stay here but we have no hope of selling so my dreams of a garden to sit in are on hold for now, and maybe Ill never be able to have the home I would have dreamed of - not an outcome I ever expected considering we are both well educated professionals who were taking home a 6 figure sum between us a few years ago and are both on the dole now. Life sure seems to have turned into Monopoly. Im at 'Do not pass go' at the moment.
 
I should add to the above that it kills me as a mother to work full time and sacrifice all that time with my young kids. I do it because I have to.
 
We are not in the same boat but can sympathize, we bought in 2007 through affordable housing so thought we would be safe from falling house prices, now apartment is probably 100k in negative equity. Our situations changed drastically in the space of a 2 years through job promotions and wanted to move to a house but could not sell the apartment.

We decided to rent it out (with councils permission) and moved back with parents to save for a deposit. In the last 18 months at home we have saved 30K and we were hoping to approach the banks next year to see if we could get a second mortgage but now we are having second thoughts as the apartment will probably be a big drain on our finances.

We currently have to subsidize the rent we receive by €150 a month to cover the mortgage, still have to pay management fees of €1,400 and will have a tax bill of approx €1k this year but this will increase in the coming years when the government no longer allow mortgage interest to be written off against rent.

Not sure what the solution is but I would love to see some proposals put forward for individuals/couples and families that have the means to move up but can’t sell negative equity properties.
 
Pyrite-home said:
I should add to the above that it kills me as a mother to work full time and sacrifice all that time with my young kids. I do it because I have to.
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It kills me as a father to work full time and sacrifice all that time with my young kids. I do it because I have to as well.
I'd also loke to take up golf and other pass times (I've never played golf but it looks like fun) but nobody's willing to give me a free ride. Who'd a thunk it?


Back on topic and to answer the OP's question; No.
 
cashier said:
Thousands of parents are rearing 2 + kids in 2 bedroom houses. We need to put things in perspective here.
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Very much so! The result of this crisis, will among other things, be a much tighter integrated economic zone, with us having to move more towards the mainland European norms...

All over Europe, people are bring up a family in two bedroomed apartments, never mind a two bedroomed house! In fact home ownership is not a high priority with most people and many even consider it a very risky thing to do! Most couples renting something small starting out, then move to something thing larger during the child rearing years and scale down again once the kids leave the nest. On retirement they often move to the country while they are still active and later to the town, so that can be near doctors etc as they become less mobile.
 
Agreed, but is this not straying from the original post. I.e. Once you are in negative equity your options are limited. I'm sure that the OP would love the opportunity to return to a position where he/she could simply rent a property of choice. While I have sympathy I can see no easy solution to this issue in the short term. No Magic Bullet I'm afraid.
 
I think my answer suggest the mind set of some of the people who will be involved in any decision making in future and for the most part those people with have hard time understanding the holy cow issue of owning a house in Ireland.

The other problem is that the proposal I've seen so far all include the owners holding on to the property in some soft of guise, in other words not a case of pressing the "Reset" button... that is always going to be a very difficult one to sell to the taxpayer. Non-recouse debt might fly, but if it does, I wonder how may will take it up???
 
We are also caught in NE but luckily are both still working and have a modest income between us. We try to be frugal and save monthly but still allow ourselves luxuries of going for a drink at the weekend and the odd dinner out. We have already decided that when we outgrow our home, we will rent it and find a bigger property to rent for our family. This may cost more than our current mortgage but if it improves our quality of life at that time, we are willing to take on the extra cost. This isn't the dream we had but sometimes you have to adapt to new situations. Life could be a whole lot worse. If this is the worst card we'll be dealt, I think we are incredibly lucky.
 
qs222 said:
we are now stuck in a 2-bed house (v nice and love the location). We now have a baby and are completely stuck where we are.
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You think that’s bad; we’ve got 4 kids and we’re stuck in a 4 bedroom house. Not only do two of the kids have to share a room but so do my wife and I!
We also have a dog but if things don’t pick up she’s for the high-jump. I’ve spoken to her about it and explained the facts of life. She says that it’s not her fault, that she didn’t buy the big kennel in the garden, but I told her that she was happy to sleep in it and had to take responsibility for her own actions. She’s now frightened every time I bring her for a walk that it will be her last view of the home place.

If that doesn’t help we’ll pick one of the kids by drawing straws.
 
Purple said:
I’ve spoken to her about it and explained the facts of life. She says that it’s not her fault, that she didn’t buy the big kennel in the garden, but I told her that she was happy to sleep in it and had to take responsibility for her own actions. She’s now frightened every time I bring her for a walk that it will be her last view of the home place.
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Is this about the dog or wife :p
 
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