Negative equity did not discriminate in its impact. When property prices began to tumble, every region of Northern Ireland suffered.
The graph of what happened between 2005 and 2012 is stunning a soaring ascent to a record-breaking pinnacle followed by an equally spectacular descent to a new low.This whole scenario manifested itself in the form of a rapid increase in the price of houses en route to an unsustainable and wholly unrealistic high which in turn gave way to a decline that broke records in terms of the percentage fall and the speed at which it happened.
In November 2011 the BBC reported that the peak-trough plummet in Northern Ireland's house prices was among the worst on record ANYWHERE IN THE WORLD.To put things in perspective, consider the following:
This Time Is Different' is a book published in 2009 by American economists Carmen Reinhart and Kenneth Rogoff. Their study of historic financial crashes revealed that house price crises over the years show the average peak-to-trough decline to be 35.5%.
However, the decline in Northern Ireland house prices blew that figure out of the water, having passed beyond the 40% mark in a period of just four years.
Indeed, things were even worse than that, for when that drastic fall was amended in line with overall inflation, the decline in Northern Ireland was seen to have exceeded 50%.
That gave Northern Ireland an unenviable place among the countries to have suffered one of the most severe house price crashes in history, the others being Finland, Colombia, the Philippines and Hong Kong where values declined by between 50% and 60%.
Alarmingly, Messrs Reinhart and Rogoff concluded that, historically, the duration of house price declines on this scale has been quite long lived, averaging roughly six years. Bearing in mind that This Time Is Different' had been published in 2009, that meant Northern Ireland was in line for several more years of house prices of falling house prices. And so it has proved.
Being Northern Ireland's capital city and therefore having the greatest concentration of people and property, it was in and around Belfast that the up-down extremes were seen most clearly.
The damage caused by negative equity has been catastrophic and although there now are signs that a long-awaited and much-needed recovery is underway, it will be some time before the market readjusts and house prices return to normality.For that to happen, Belfast house prices will have to come back up from their very low starting point. Don't be fooled, then - that is going to take time, so bear in mind that stark percentage rate increases can be somewhat misleading if you fail to take account of the starting position.
In Belfast and Northern Ireland that starting position was and continues to be horrendous. Figures produced back in early 2012 by the Office for National Statistics showed a 10.7% drop in Northern Ireland house prices.
In response, Ed Stansfield, chief property economist at Capital Economics, explained: During the 2000's house prices in Northern Ireland absolutely soared. This is the process of normalising.
Lenders, Halifax, also confirmed what we already knew. A report published by Halifax concluded: In 2007 prices in Northern Ireland were the highest in the UK outside London and the South East. Ultimately these were unsustainable.But now after so much gloom and doom, things are changing with the most recent house prices in Belfast providing clear evidence of growth.
Of course it will be a very long time before they reach the record high of August 2007.
But demand is pushing prices upwards again, with by far the most significant increases in the province being in the usual hotspots of south, south-east and east Belfast plus nearby north Down.Encouragingly there have been increases in the price of homes in every category - detached, semi-detached, terrace and flats.
Some fortunate people are even managing to sell for significantly more than their asking price, underlining the fact that after years in the doldrums, property is on the up and up. Vitally, too, these increases finally may enable some of those in negative equity to start selling their properties and move on.
Average property prices in Belfast now are £357,486 for a detached, three-four bedroom home; £193.000 for a semi-detached three-bedroom home; £139, 252 for a terraced, three-bedroom home and £132,092 for a two-bedroom flat.As ever, though, location is the all-important factor with the Upper Malone area being the most expensive/exclusive in Belfast.BT17 and BT9 are the areas most in demand, a fact reflected in the prices for properties there.So undoubtedly there are encouraging signs. Despite that, however, there are many who remain deeply entrenched in negative equity and unable to move, even though they need.to do so because their circumstances have changed.They may that due to a change in their employment and income they are in such debt mortgage arrears, unsecured loans and whatever else - they are unable to wait for the wind of change to blow in their favour.
It could be that youhave outgrown the home which is now in negative equity. Conversely, your house may now be too big for you.Perhaps youhave divorced or are in the process of divorcing, for which reason you want/need to sell but fear you will not be able to do so.So it isn't a case of happy days' for everybody trying to sell a property in Belfast right now. The process of normalising to which property economist Ed Stansfield referred is one that will take time.But even if you feel that is the one thing you don't have, there is hope. When it comes to rescuing people like you from the quagmire of debt, based in Belfast, we at Negative Equity NI are market leaders.
If any of the situations described is true of you, phone our helpfultoday and get help: 028 9023 6074 or contact us here.