The rate of repossession in the three months January to March remained at 0.07% for the fourth consecutive quarter, according to data published today by the Council of Mortgage Lenders. This rate is the equivalent of fewer than 1 in 1,400 mortgaged properties being taken into possession by lenders each quarter.
Arrears also remain stable. The number of mortgages in arrears has been similar across all categories for at least a year, and the underlying trend is unchanged. At the end of the first quarter some 159,800 mortgages had arrears equivalent to 2.5% or more of the mortgage balance. This number was equivalent to 1.4% of all mortgages – the same proportion both as last quarter, and as the same quarter last year.
Within the total number of mortgages in arrears, 82,600 mortgages had arrears equivalent to 2.5% or more but less than 5% of the mortgage balance, 32,000 5-7.5% of the balance, 14,900 7.5-10% of the balance, and 30,300 10% or more of the balance.
A total of 8,000 properties were taken into possession (down from 9,600 in the first quarter of 2012, but showing the the usual seasonal pattern of an upturn from the fourth quarter figure of 7,700). Around 20% of repossessions were on buy-to-let rather than owner-occupier properties.
The CML’s last forecast for 2013 anticipated that there would be a total of 35,000 repossessions in 2013, with 160,000 mortgages in arrears of 2.5% or more at the end of the year. The CML has no imminent plans to revise this forecast.
CML director general Paul Smee commented:
“Mortgage arrears and repossessions have stabilised at levels lower than many anticipated when the economic downturn started. Low interest rates, continuing employment, lender forbearance and tactical public policy support have combined to ensure that repossession really is a last resort.
“Anyone who is worried about their mortgage can be assured that, as long as they take steps early to address them, most problems can be contained. Lenders very much want to enable people to stay in their homes wherever they have sustainable prospects of getting their mortgage back on track.”