The great house-price trap

Nearly a fifth of homeowners who bought their property in the last five years are now in negative equity, according to property website Rightmove.co.uk. This means that the value of their houses is less than the outstanding mortgage debt secured on it. Rightmove now believes that it will take "more than a modest market recovery" to help many of those affected.

The major problem with being in negative equity, aside from the fact that selling a home would trigger an immediate overall loss, is that in most cases it stops the homeowner from moving house. One bright spot for those trapped came from Hometrack, which stated that, although its latest price survey suggests year-on-year home prices have fallen by 0.4% nationally, this is the smallest fall for two years.

Meanwhile, a survey from accountants KPMG has found that nearly five million people in the UK are not earning the so-called living wage'. To maintain a decent standard of living you need to be earning £8.30 an hour in London and £7.20 outside the capital. Around 90% of bar staff earn less than that, say KPMG. Little wonder, then, that four in ten people believe their finances are worse now they were just a month ago.

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Animal-lovers are being wooed by Yorkshire Building Society. Its new RSPCA saver account pays 2.2% interest annually, plus it makes an annual donation of 0.25% to the charity. However, other accounts offer better interest rates for example, the Post Office 30-day notice account pays 3%, while Natwest offers an online savings account paying 2.85%, including a 1.81% bonus for the first 12 months. You can always make a separate donation to charity.

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