Negative equity fears 'discouraging home buyers'

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With the impact of the credit crunch continuing to be felt throughout the UK property market, many people are opting to put off their plans to move home.

That is according to Andy Pratt, spokesperson for mortgage advisor Alexander Hall, who maintained that consumer confidence has been dented by fears over negative equity.

He said that it was "understandable" that homebuyers were increasingly choosing to wait and observe the market, as buying a property and taking out a mortgage represented a "big commitment".

Commenting on reports surrounding negative equity, Mr Pratt said: "It's certainly a dent in consumer confidence, and there are a lot of people - home-movers and first-time buyers - who are taking a conservative view and deciding to wait and see what happens, which is obviously very understandable.

"Buying properties and spending money on a mortgage is obviously a big commitment, so in that sense it can't just be dismissed - it's going to have a consumer impact."

With an increasing number of people opting to defer their property purchase, demand for rented accommodation could remain high - spelling good news for buy-to-let landlords.

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