HOMEOWNERS are being advised to stay calm after it was revealed more than 23,000 people in the UK faced owing lenders more than their property was worth.

New data from the Council of Mortgage Lenders shows that more than 23,000 people who took out 100 per cent mortgages in the year to 31 March could be facing negative equity due to falling property values.

Latest figures from the Land Registry show that every borough of East Lancashire except the Ribble Valley, saw values fall during the first quarter of 2008.

In total, Lancashire has seen an average drop in house values of 5.5 per cent, with the average detached property now worth £290,449, semi-detached £159,067, and terraced house £102,767.

Graham Ireland, conveyancing partner with East Lancashire law firm Haworth and Nuttall, has warned that falling values would mean house buyers who bought a property using a 100 per cent mortgage last year could face negative equity - owing more to the mortgage lender than the house is actually worth.

However, Mr Ireland has urged home owners to stay calm, suggesting that values would increase again.

He said: "Even as recently as late last year, lenders were still willing to provide mortgages of 100 per cent (and in some cases, over 100 per cent) of a property value as home buyers (particularly first time buyers) struggled to afford a property amid rapidly increasing prices.

"But now values have started to fall this is no longer the case.

"Thanks to the international credit crunch, lenders have changed their lending criteria considerably, meaning that these types of mortgages (and many other high percentage mortgages) are no longer so readily available.

"However, those home owners who did obtain a high percentage mortgage could now find that their property is worth considerably less than they paid for it.

"This will mean that any such owners who struggle financially and who need to sell will have difficulty in doing so. The knock on effect will be that repossessions will increase.

"However, the key message from property professionals is that this reduction in property values is only temporary (albeit that it could last some time).

:As we have seen recently, prices are subject to regular increases and falls, and I would advise owners to stay calm, prioritise their mortgage payments, and wait for property values to increase again.

"There are many scaremongers fuelling negativity, but history shows that there are peaks and falls in the market.

"We are currently in a fall, but the industry is expecting it to peak again even though it can not be sure when it will happen."