Homeowners in Huddersfield who find themselves caught in the negative equity trap are looking at a long wait before they will see a profit on their homes. Estate agents in the area have agreed with the figures from the National Housing Federation; who say that those homebuyers who bought when the housing boom was at its peak in 2007 will have to wait at least four years before they turn the corner.

Negative equity occurs when the value of a property falls below the value of the loan that was used to buy it. Independent forecasts show that people who bought at the height of the boom paid an average of £216,800, it is predicted that this average will rise to £226,900 but not until 2014.

This picture is all too familiar to Paul Keighley, who is a partner at an estate agent in Huddersfield. He said “People in Huddersfield are in a similar situation. Anybody who bought at the peak in 2007 saw a 15% or 20% drop, so for them to get back into positive cash flow on their property it could take that long. It’s difficult to put a definite figure on how many people in the area are in that position. There are some good signs in that there are people who are waiting to move and repossessions seem to have slowed. Until the banks start lending to first time buyers at reasonable rates, it will be hard for the market to get going. The situation for those people is a minimum 10% deposit, but add to that legal and survey fees and arrangement fees for the lenders the cost could run into four figures in certain cases.”

The level of borrowing against the value of a house in Huddersfield is less than the national average. A property is not just a home it is also an investment which can be protected by household insurance. The figures which have been released will be dominated by properties in the south which could cause nervousness in some quarters, but in Huddersfield and surrounding areas homeowners look at things long term