Kicked in the Cobblers!

A TOWN has been left reeling from the news that it is Britain's capital - for negative equity.

Plunging property prices have made Northampton the place worst hit by the nightmare of mortgages exceeding homes' values.

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The town's history of shoe-making is reflected in its newly - relegated football team being nicknamed The Cobblers.

And that's exactly where locals feel they've been kicked now that one borrower in six is caught in the equity trap.

Figures show 16.9 per cent of all mortgages in Northampton are for more than the properties are worth.

That is closely followed by NOTTINGHAM, where 16.2 per cent are in the same boat, then DERBY with 15.1.

The figures have been compiled by housing market analysts Fitch Ratings, who list the UK's worst affected towns or cities and worst-hit regions.

A map of the regions shows the blackspot is the EAST MIDLANDS (15.1 per cent) - which includes Northamptonshire.

Some homeowners in Northampton owe £270,000 on houses now worth just £199,000. And new flats sold for £200,000 have dropped up to £50,000.

Several estate agents fear one mortgage in FOUR will end up in crisis.

Homeowner Lisa Engelby, 36, has seen her brand new four-bed house in the town's swish Upton Square Development plunge by over £70,000 to £199,000.

The mum of one said: "It's pretty sickening but I'll have to just get over it and not worry."

Brickie Michael Fisher, 24, and girlfriend Natalie Davies bought a two-bed home for £115,000 but had to sell it for £95,000 when he lost his job.

Michael said: "We tried everything we could to keep it. I am devastated."

Industry experts blame Northampton's aggressive expansion and an over-supply of flats for its inability to cope with the economic downturn.

The town's population ballooned to 200,000 and major employers including American Express and Nationwide set up shop in the area.

But by March this year 70 people a day were being made redundant.

In Nottingham, the rush by developers to build thousands of flats and starter homes was blamed for the city's soaring negative equity.

Justin Egberts, boss of estate agents JE Properties, said: "During the boom years many first-time buyers were given huge mortgages of 95, 100 per cent or even more. With no deposit, it's obvious that if the market took a downturn they were going to be in negative equity."

The collapse of the buy-to-let market was also seen as a major factor in the problems facing Derby.

Fitch Ratings director Alastair Bigley said many homeowners had simply taken too big a risk by borrowing more than they could afford to repay.

Ten worst-off towns or cities by percentage of buyers in negative equity: Northampton (16.9); Nottingham (16.2); Derby (15.1); Cardiff (14.7); Wigan (14.5); Manchester (14.5); Peterborough (14.1); Lincoln (13.8); Hull (13.4); Ipswich (13.1).

Worst regions: East Midlands (15.1); Wales (13.2); East Anglia (12.8); North-West (12.3); Yorks & Humber (11.8); West Midlands (11.5); Outer South-East (10.8); North (10.1); Outer London (8.8); London (7.9).

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