Since the 2007 peak in property prices, more than 130,000 homes have been sold at a loss, new research has revealed.
This is according to an in-depth analysis of housing transactions in England and Wales based on Land Registry data. It found that 40.7% were sold at a lower price than the original purchase.
The analysis, conducted by housing investment and shared equity provider Castle Trust, revealed that the average shortfall stood at £24,430, which is equivalent to 11% of the entire house price.
Sean Oldfield, chief executive officer of Castle Trust, said: “Since the downturn, over 130,000 families have made a loss on their home placing them under enormous financial and emotional pressures.
“When you take into account the costs associated with moving home, from stamp duty to solicitor’s fees, this situation becomes even worse.”
In the same period, 55.6% of homes were sold at a profit, generating 20.4% of the house price on average, while 3.7% of properties sold for the original purchase price.
The Trust said that the probability of making a loss and the size of average deficit has rocketed since the economic downturn began its assault on the UK.
Since 1995, just 7.5% of homes sold at a loss while 91.5% sold for a profit. 1% sold for the original sale price.
Mr Oldfield continued: “The long-term performance of house prices shows national house price growth in line with national wage growth, but it is clear that individual house prices are really volatile and that home ownership is risky – much more risky than almost everyone appreciates.”
13% of homeowners have voiced concerns that they may be forced to sell their current home for less than the purchase price, a figure which rises to a quarter among those aged 18-34.