Citezens Advice - Increasing Demand
2008 always promised to be a busy year for providers of citezens advice, however, the economic downturn has fueled an unprecedented increase in demand.
The major increase in demand is due to the so called credit crunch which is affecting the entire economy. Large numbers of homeowners now find themselves in negative equity and are therefore unable to sell their homes to clear debts. They are equally unable to downsize, as they cannot sell their home due to the shrinking market. It is a classic case of “if you are in, stay in, if you are out, stay out”. Meaning that those who are outside the housing market are staying out, waiting to see how far prices fall, and those who are already in the housing market, by default have to stay in as they cannot sell / extract themselves from the situation.
This group of unfortunate debtors are now those most likely to seek citezens advice, and, are unusually likely to come from more middle class backgrounds.Many of these people have run up large un secured debts during the “boom times” of the late 1990’s, early 2000’s. At that time, when credit was cheap, there seemed little risk in accruing large debts, particularly as house price increases tendeded to exceed the level of unsecured debt being incurred.Today however, with the value of equity in property falling, there is a real risk that many will go bankrupt.
