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According to a recent report by High Street banking giant HSBC, more than 350,000 homeowners are now in negative equity, as the property market continues experiencing turbulence. It is thought that up to 360,000 homeowners who purchased their homes in 2007 are now stuck in their homes to due being in negative equity. Plummeting property prices and restrictive lending have taken their toll on those who purchased homes just prior to the global financial crisis.

Officials from HSBC said that although not all of these homeowners were in negative equity as such, many were in a situation where they did not have enough equity in their homes to pay a 10 percent deposit on a new mortgage or home, pay stamp duty and deal with other moving costs.

First time buyers are said to have been affected particularly badly. Figures show that in 2007 the average deposit put down by first time buyers was 10 percent and with the average property price at that time being £160,000 this gave equity of £16,000. H

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“Home equity will lag because home equity, by its nature, we find lags the underlying prime and the underlying real estate and lags more than most other things,” JPMorgan CEO Jamie Dimon explained in an earnings call last week. “We try to account for that in our reserving.”

There’s been plenty of speculation regarding potential costs of the foreclosure crisis for big banks. Potential litigation from state attorneys general, homeowners and investors – along with buyback requests from purchasers of mortgage securities – has left room for optimists to shrug off the potential costs as immaterial pessimists to predict doomsday scenarios.