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3.45m homes bought in last 5 years now 'Underwater'

22nd June 2011

New research from leading property website Zoopla.co.uk shows that 4 out of 5 homes purchased in Britain since 2006 have a market value today below their purchase price. Of the 4.32 million homes purchased since 2006 and where the ownership remains the same, 3.5m (80%) of these homes are ‘underwater’ (worth less today than their purchase price), according to

Zoopla.co.uk which lists over 17 million previous sale prices and provides current value estimates for every UK property.

Those worst affected are the homeowners who bought at the peak of the market. 93.2% of homes bought in 2007 and 88.9% of those bought in 2008 are now ‘underwater’. Over the last 5 years, buyers who have fared best are those who bought in 2009, having successfully timed the bottom of the market during the recent downturn.

At a regional level, the North East of England is the worst affected area, with 93% of properties purchased since 2006 yet to climb back to the values paid for them by their owners. At the other end of the scale, less than half (46%) of homes bought over the last 5 years in London are now valued below their purchase price, underlining how much more resilient the capital has been to the property downturn versus the rest of the country.

Nicholas Leeming of Zoopla.co.uk, commented:: “There is an unprecedented number of homeowners ‘stuck’ with homes they bought in recent years with the expectation that prices would continue to sky-rocket. And as a result of not wanting to take a loss on their asset, many owners have been unwilling to set realistic asking prices to sell them. The London market has been unique and bounced back very strongly from the recent market lows of 2009.”


Number of homes 'Underwater'by year of purchase

Year

# Transactions

# Below Purchase Price

% Below Purchase Price

2006

1,165,239

88,8293

76.2%

2007

1,184,000

1,103,240

93.2%

2008

631,964

561,902

88.9%

2009

607,502

288,664

47.5%

2010

638,626

561,797

88.0%

Total

4,320,569

3,458,513

80.0%

Source: Zoopla.co.uk (June, 2011)


Number of homes bought in last 5 years 'Underwater' by region

Region

# Transactions

# Below Purchase Price

% Below Purchase Price

North East

231,088

215,264

93.2%

Yorkshire & TheHumber

306,507

283,920

92.6%

East Midlands

322,987

293,838

91.0%

Wales

178,604

158,156

88.6%

North West

453,840

398,375

87.8%

West Midlands

352,124

308,181

87.5%

South West

442,365

373,062

84.3%

Scotland

374,387

306,032

81.7%

East

459,174

360,911

78.6%

South East (exc.London)

708,189

533,630

75.4%

London

491,300

225,779

46.0%

Total

4,320,569

3,458,513

80.0%

Source: Zoopla.co.uk (June, 2011)

- Ends -

For further information, please contact PR Team on pr@zoopla.co.uk or +44 (0)20 3873 8770.

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And that bungalow won't just be a way to release some equity, it will be a chance to spend more time with the grandkids.

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What really matters is how it makes you feel.

We know what a home is really worth.

So let us help you find yours.

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