House prices have fallen dramatically but homeowners are detached from reality, a new survey shows.
Homeowners are underestimating how far the value of their property has fallen in recent months, according to new research. A survey by Impartial.co.uk shows that the average mortgage holder believes their home has fallen in value by £1,233 in the last quarter, when in actual fact it has dropped much further than this.
Land Registry figures show that between July and September, house prices fell by 6.1 percent. However, according to the research, homeowners think they have declined by just 0.1 percent - from an average of £202,231 down to just £200,998 - while those under the age of 34 believe the value of their property is still increasing.
Karen Barrett, a spokesperson for Impartial.co.uk, said: "It is worrying just how much we are under-estimating house price falls. Whilst no homeowner likes to think that they have lost money on a property, the important thing to remember is your home is much more than just an investment."
And she said that even though prices are falling and fewer people are moving up the property ladder, homeowners coming to the end of their deals should still think about remortgaging, especially since interest rates have fallen by two percent since September.
According to the Land Registry, the average home cost £168,814 in September - down 2.2 percent compared to the previous month.
