Economic and political commentator Bernard Hickey says negative equity is "not a very big issue at all", and that "on the whole people who own homes are perfectly fine".
Negative equity is when a person owes more on a house than the value of that house.
Hickey estimates there were about 500 Kiwis who might feel they were in negative equity, but said most of them have no reason to worry.
"It's a potential issue for those people who bought and then have to sell really fast," he said. "But as long as they don't get divorced or die, then they won't have to sell their house, because the banks aren't going to force them out and they've more than likely got plenty of income coming in to pay the mortgage as they go."
"It's not a very big issue at all.
READ MORE: Falling house prices put some homeowners into negative equity
"Even the most recent figures for the June quarter show that 98.1% made a profit on their house sale and the average profit was $418,000 - so on the whole, people who own homes are perfectly fine.
"And the ones who might feel they're in negative equity have got a job, are paying their mortgage, the bank isn't going to kick them out, and so they don't have a problem at all unless they get divorced or die."
Hickey added that, on top of that, there is also a prospect of house prices bouncing by the end of next year.
He believes house prices in Auckland city and Wellington city have already "troughed out" and are rising again.
"Now the rest of the country is still catching up with Auckland and Wellington, so they're still continuing to fall - but remember, interest rates have stopped rising. In fact, in the last couple of months, there's been fixed mortgage rate cuts.
"Those people who are thinking of buying right now and can't afford to get in, they're the ones who really have a problem."
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