Michael McGrath (Cork South Central, Fianna Fail)
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128. To ask the Minister for Finance the number of households in negative equity; the implications of this for the wider economy; and if he will make a statement on the matter. [45945/15]

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.I have been informed by the Central Bank of Ireland that it does not publish a regular series of data on mortgages in negative equity.Neither do officials in my own Department collect such data. The Central Bank's latest Household Credit Market Report, at, presents the percentage of loans in negative equity by the origin year of the mortgage (Figure 17, HCMR H2 2015). These data are for December 2014 and do not reflect changes to loan balances and house prices since December 2014.

However, the Deputy may wish to note that the ESRI's Summer Quarterly Economic Commentary provides the most recently available research on the number of mortgages that are in negative equity and can be accessed at . This report shows that the estimated number of those who are in negative equity continues to decline with the rise in residential property prices.

According to the ESRI's analysis, the number of mortgages, nationally, estimated to be in negative equity reached close to 315,000 at the end of 2012 but has continued to decline since, with an estimated 267,000 in negative equity in 2013 and just over 161,000 in December 2014. Based on residential price developments for this year, it is now estimated that somewhere in the region of 100,000 mortgages are likely to be in negative equity by the end of 2015.

Residential property price increases are relevant in alleviating the extent of negative equity and household over-indebtedness and this has important implications for the wider economy. The reduction in negative equity should improve mobility amongst those affected, encourage spending on home improvements and maintenance, and increase consumption via the wealth effect.