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UK homeowners pulled into negative equity trap

A review of the UK property market may look promising for the short to medium term but for those who acquired properties back in the early 2000s the doom and gloom will go on. A report issued today claims that those who acquired property in the UK just prior to the 2007 peak in the market will remain in negative equity until at least 2014 with many struggling to cope with increases in energy bills and other everyday costs.

While the UK government and UK mortgage lenders fight over who should be helping home owners, more and more people are falling into the negative equity trap in homes which have fallen in value and mortgages which many cannot afford. In a reflection of the greed of the 1980s, 1990s and early 2000s it is becoming more and more apparent that many people acquired properties at the top of the market with the intention of selling them on for a significant profit in the short term. These are the people who will be left in negative equity for many years to come and will ultimately be financially crippled for some time.

If there is one thing which prospective home owners should learn from the ongoing recession it is the fact that you should never overextend your finances and assume that markets will continue to grow.

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