I’m still in negative equity – get me out of here

We bought our Athlone home in July 2007. Within months it had dropped €90,000 in value. Now we can't move on because we can't muster the 20 per cent deposit needed

Jenny Sherlock pictured outside her home in Athlone. Photograph: Thomas O’ Hanlon

Jenny Sherlock pictured outside her home in Athlone. Photograph: Thomas O’ Hanlon


My husband and I, like many others in our generation, bought a house during the boom when money was plentiful, banks were lending and hopes were high.

We got the keys to our ‘first’ house, an average three-bed semi-detached property, in July 2007 knowing nothing of what was to come.

At the time, we bought with the intention of trading up as our family expanded but, mere months later, the market crashed and we found ourselves plunged into negative equity as the value of our house fell by almost €90,000 overnight.

Eleven years and three children later, we are still in the same house which now feels much smaller than it did the first day we crossed the threshold.

We try endlessly to minimise the amount of ‘stuff’ we accumulate (our kids don’t always agree) but with never-ending piles of laundry and limited storage for toys and clothes, it feels like we are bursting at the seams.

The need for more space is becoming increasingly apparent and although all they really want is a garden they can play in, we can’t even give them that. It is frustrating not being able to fulfil such a simple wish, especially when we are 11 years into our mortgage.

On top of this, it is becoming increasingly difficult to write at the kitchen table with a constant flow of people in and out and no specific space to work in.

I grew up in a bungalow with a good-sized front and rear garden. Memories of my childhood conjure up images of climbing trees, endless hours of outdoor play and walking down country lanes picking blackberries.

We had space to ride our bikes, spent hours making daisy chains and our parents never had to worry about us when we were outdoors. For me, this was an idyllic childhood, one which I long for my children to experience. My kids have country blood in their veins and this is very evident when they spend time in their grandmother’s house. Unfortunately where we live, like in any other housing estate, there is limited outdoor space.

While estate living has its benefits ie, accessibility and closeness to neighbours, my heart belongs elsewhere. We are not looking for a mansion or anything excessive, a modest house in the country with an extra bedroom and more outdoor space would be perfect, but this seems unattainable because of the current rules.

From boom to bust and back again

We, like many others, faced years of uncertainty regarding our future as homeowners as we were stung by the devaluation that resulted from the property crash. House prices have begun to rise in recent months; our house is now worth about €40,000 more than it was in 2010 but it is unlikely that it will ever reach pre-recession levels and so we are not likely to sell at the same price we bought, if we manage to sell at all.

Although our area has not been hit as hard as many others in terms of sharp increases or decreases in house values, the recovery is slow in our area in comparison to some major towns and cities.

I know that our experience is far from isolated and that the entire country has been affected by devaluation and negative equity.

I can, however, only comment on my personal experience and circumstances. In theory, negative equity is only a problem if you intend to sell your property but the reality is that so many homeowners owed far more than their property was worth and the properties we all worked so hard for became almost worthless. There are still many in negative equity a full decade after the market collapse.

Despite some improvements in values and equity, we now find ourselves in an environment where we, as second time buyers, are required to have a 20 per cent deposit in order to move home. This seems unfair and unnecessary given that first time buyers require only half that amount. Why does the system seem to punish those with a proven track record of payment?

The majority of second time buyers are families like us who, in addition to paying a mortgage, bills and living expenses, often have childcare costs to consider. For my family, saving a 20 per cent deposit (which can mean anything from €40,000-€90,000) is neither feasible nor realistic. The 20 per cent deposit rule means that existing homeowners like us who wish to move are being penalised for already having a mortgage or for buying our home at the wrong time.

Time for a different approach

I know we are lucky to own our own home and I sympathise with the plight of those trying to save for their first home in the current rental environment.

However, the focus remains firmly on first time buyers and the measures put in place to assist them, while we are left in limbo. Steps should also be taken to help second-time buyers by reducing the 20 per cent deposit requirement to 10 per cent. This would at least allow some of us who are currently ‘stuck’ to move to more suitable houses, and free up more affordable options for those wishing to buy a first home.

Some home owners may have managed to save 10 per cent but it is likely to take several more years of saving to amass a full deposit, while others have entered positive equity but have not managed to save enough to cover any deposit.

Friends who bought at the same time as we did have accepted that they will remain in their current houses and have renovated to better suit their needs. While opinions differ on a solution to the property trap people find themselves in, it seems all agree that a problem exists, and that real progress is unlikely unless the remedy takes everyone into account, not just first-time buyers.

Our journey as homeowners has taken us from a place of hope and optimism to one of resignation and defeat and unless the system changes, our situation is likely to remain as it is now. I am not looking for sympathy, I am simply telling my story, one I’m sure many will relate to.

It has been a very trying time over the last decade and I know there are stories worse than mine, of hopelessness and loss. Meanwhile, we will cross our fingers in hope that those who make the rules will introduce a system that is fit for purpose and that allows families like us to find the home that is right for them.

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