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Residential repossessions jump 10%

Christina Hoghton
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Christina Hoghton

Despite the rise, repossessions are still well below levels seen following the financial crisis

Just under 1,400 homeowner mortgaged properties were repossessed in the first quarter, up by 10% on the same period last year, new data from UK Finance has revealed.

The trade body was keen to emphasise that despite the rise, this remains well below the levels seen between 2009 and 2014, when quarterly repossessions peaked at more than 13,000.

UK Finance suggested the rise was driven in part by a backlog of historic cases which are being processed in line with the FCA’s most recent guidance on borrowers with payment shortfalls.

It noted: “Lenders have been reviewing a large number of cases on an individual basis in line with this guidance, applying for possession only when all other options have been exhausted.”

While repossessions rose over the quarter, the number of residential mortgages in arrears of 2.5% or more of the outstanding balance dropped 4% to 76,580.

Investment properties

On buy to let, the number of deals in arrears rose by three per cent to 4,620. Of that, there were 1,200 in arrears of 10% or more, up by 12% from the same period last year.

UK Finance said: “While we are seeing mixed signs in buy-to-let arrears, these do not indicate a clear increasing trend at this stage. Additionally, increases are small and from a low base.”

Jeremy Leaf, former residential chairman of the Royal Institution of Chartered Surveyors, said the softening of the housing market was reflected in the figures, “particularly for buy-to-let landlords who are falling into arrears from the pressure of tax and regulatory changes, as we might have expected.

“These figures also show that there is little appetite among lenders to repossess because they are not going to do too much better than the owners themselves in achieving a sale at a reasonable price.”