a reporter knocked on my door and asked how i feel about living in a street with one of the highest risks of negative equity

[oranges]

Feel a bit and wasn't sure what to say. I bought nine years ago so am not too bothered but still........should I be bothered? It's a two bed flat, and we had thought of moving but after being gazumped twice I gave up. ((dithers and wonders what she's posting for))

How does the reporter know how much equity you have in your house?

I would have told the reporter where to go. What business is it of his? And I would definately not be answering his questions. Personally, it would not bother me about the negative equity on the street - a big 'so what'

He doesn't know how much equity I have, and neither do the people who compiled that report, which is why I was curious as to how it was put together. Negative equity is surely only a problem if you have to sell?

But surely it is to do with the individual mortgage holder rather than the street itself? If your own ltv ratio is not a problem, what does it matter if you live in SE1?

I assume the negative press coverage may in itself drive prices down though, which is annoying.

WEll quite.

I wonder how much of this is as a result of self-fulfilling prophecy whipped up by media reports. So good on you for not bursting into tears!

I don't think it's really a reliable forecast of anything. The only place I've seen this published is the Daily Mail and the Evening Standard who love a bit of scaremongering.

Still trying to figure out how they collect this data - are mortage advances and property purchase prices recorded and passed onto Experian as part of credit scoring/checks?

it can't be a self fulfilling prophecy when the banking system is in meltdown.A healthy affordable market couldn't be talked down that far as people still love homes and want to own them but affordability is at an all time low.Historically prices always revert to a figure determined by approx 3-4 times salary.Negative equity is a v real possiblilty if your mortgage is 85% or more of the value and you need to sell otherwise enjoy your home and it will all be over by 2012!

I think negative equity can be a problem for the lender because your mortgage is secured against your house, and if your house is worth less than the value of the loan they no longer have that security.

I suppose the question is, if you were a buyer looking in that general area, would reading an article like that put you off those particular streets? And would that affect prices in those streets?

There are still more articles on the desirability of the area.....Borough Market, the South Bank, etc than there are ones like this one.

[smug emoticon] followed swiftly by [desperately hoping prices don't crash emoticon]

I think the article would certainly encourage a buyer to offer a lower price, but lots of people do still want to live here.

Noddy - fair enough about the bank meltdown - and in fact i think that ending loans which clearly expose people so much is no bad thing.

But the the first whiff of 'credit crunch' or 'recession' has spawned websites instructing poeple how to effectivel 'gazunder' etc - which must surely amplify the effect.

your 'salary levellin' point is a good point.

So long as you don't intend moving it is fine. property is almost always a good invetment if you are in it for the long term; no longer good if short term.

I rent. It has its advantages. Anytime someone knocks on teh door selling something or that, we just tell them, 'Sorry, it's not ours.'

lol expat. I still say that to get rid of people.

I'm glad now I didn't get bounced into offering 20k more to our would-be sellers last year - they asked for the extra the week we were due to complete and I refused. They did find a buyer later, but then over-extended themselves at the top of the market. It's hard to squish the shadenfreude.

Goodegg: yes, Experian are HUGE credit checking agency that many lenders use and has scary amount of data on all of us, especially in terms of our debts and our spending habits. So they will get some spod to run a program and then draw very broad conclusions from it.

lalalonglegs - thanks, I've used Experian before and have got hold of my credit reference file - fascinating stuff - amazed how much they record - exactly how late you pay your credit card and all that stuff.

Didn't realise they collected mortgage data - in order to create this map, they must be matching purchase price and mortgage advance but what I'm also wondering is whether they:

• factor in the rise since the property was purchased

• calculate the number of interest only vs repayment mortgages

Obviously these factors have an effect on whether the LTV is the same as when the mortgage was taken out and whether people are really in danger of negative equity.

Oh well, who knows what will happen. At least we're not in the dire straits of 1991 when interest rates were 15%!

I thought property prices fell more than 27% last time!
Can't believe Tooting is at low risk of falling

I think the thing you have to remember is that people still need houses.

Things that will really effect property prices will be unemployment and oversupply.

Alot of small flats have been built in the last 5 years and I think people who have bought these as investment properties are getting burnt because there just isn't the demand. This will obviously have some knock on effect on the general market

However, if there are families with jobs wanting houses and there aren't enough houses to go around, there will still be demand.

I live in teh most desirable area in brighton re parks schools houses etc.Up until last year houses in the surrounding streets rarely made the papaers as people were on lists to buy them.Now there are 100+ houses in these streets and none selling.Shortage?It is only a shortage if people can afford them otherwise it is over supply.Lovely house opposite me has been on the market since last spring at 445 finally reduced to 340 and sold last week.

MadameP, yes people need housing but in many areas renting is now a cheaper option.

Estate agents and vendors seem to forget that people have a valid - and sometimes more cost-effective and flexible - alternative.

Property is ultimately an investment. If it looks like a bad investment, people won't buy.

If the govt could improve the rights of tenants and the obligations on landlords, we could get rid of this speculative property investment bullshit.

true brummie.I am renting atm it is 950 a month and not worth a penny of it tbh but if I bought it at current rates it would be 1400 a month plus it needs complete renovation and is only a flat!

Ed Stansfield from Capital Economics (quoted in that linked Evening Standard article) famously predicted a 20% fall in property prices a couple of years ago. The market in fact rose by about 20%.