Pearse Doherty (Donegal South West, Sinn Fein)
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254. To ask the Minister for Finance the number of persons whose homes are in negative equity. [4682/15]

Michael Noonan (Limerick City, Fine Gael)
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Negative equity occurs when the price of a property falls below the value of the outstanding mortgage secured on that property.

While regular data is not collected on the number of persons whose homes are in negative equity, the Deputy may wish to note that there has been some independent assessment of the issue conducted recently by the Economic and Social Research Institute (ESRI). The ESRI published a paper in August 2014 Updated Estimates on the Extent of Negative Equity in the Irish Housing Market. This paper can be accessed at the following link :

The paper estimates the extent of negative equity based on certain assumptions regarding the volume of mortgages, house prices, mortgage term, interest rate, buyer type, Loan-to-Value ratio and level of arrears. The paper estimates that the total number of mortgage loans in negative equity reached a peak of over 314,000 by the end of 2012. However, the subsequent recovery of house prices reduced that number - the ESRI estimates that the numbers in negative equity fell by 15% in 2013 and would further improved in 2014 as prices increased.