I’m caught in a mortgage hole after property prices collapsed
Published 05/09/2009 | 01:15
A civil servant has told of the nightmare of being caught in a property trap after he was one of 100 purchasers in the Titanic Action Group who signed up to buy luxury apartments in Belfast two years ago, that have slumped in value by as much as 30% as they near completion.
The man, who wants to be known only as Ben, told the Belfast Telegraph yesterday that he was caught in a mortgage hole created by the slump in property prices. He also said he is unable to sell his current flat which has dropped £80,000 in value.
Ben’s apartment at the Titanic Quarter was worth £200,000 when he put pen to paper with Harcourt Developments when property prices were at their peak.
“I paid a deposit of £20,000 to secure the apartment which is due for completion in November/December,” he said yesterday.
“But now the apartment has been valued at around £135,000 and that’s the limit which the Nationwide are prepared to grant me for a mortgage. It leaves a black hole of more than £60,000. Other purchasers are worse affected than I am, with prices as high as £600,000 for penthouses.
“The 100 purchasers in the group are being represented by Brian Speers of GMC Solicitors and we want a meeting with Harcourt Developments, without preconditions, to try and reach a compromise. We fear that they may hold us to the original prices and lead to some of us being declared bankrupt. Frankly, it’s impossible for me to garner the extra money and I don’t know what I’m going to do.”
Ben’s situation is complicated further by the fact that he is paying off a mortgage on his two-bedroom flat in Coleraine, which he has so far been unable to sell.
He explained: “Two years ago, my job was transferred from Coleraine to Belfast and my flat in Coleraine was worth £200,000, so it seemed the simple solution to buy one of equal value in Belfast and do a simple switch.”
But the Coleraine flat has slumped in value to £120,000, he has signed up at £200,000 for the Titanic apartment, and now he is trapped in the property snare.
“It’s a nightmare. The mortgage gap is horrendous, and we fear that if they hold us to the original agreement, many of us will go under. We are not putting any preconditions on a meeting. We simply want a compromise that will suit both sides. But so far Harcourt have not indicated they are willing to meet us and even discuss the situation.”
The Belfast Telegraph contacted Harcourt Developments but did not receive any response.