UK repossession levels at 4 year low

The continued interest rate freeze and a willingness among Lenders to patiently deal with mortgage arrears are thought to be responsible for bringing house repossession levels in Northern Ireland and the rest of the UK to a 4 year low, and below the prediction made by the Council of Mortgage Lenders (CML) for 2011.

The CML had forecast that there would be 40,000 property repossessions in 2011, but they were nearly 10% over in their estimate as 36,200 houses throughout Northern Ireland and the rest of the UK were repossessed last year. That was less than in 2010, but CML do not expect to see the decline in repossession levels continue into 2012, as increased unemployment is expected to result in a growing number of borrowers falling into arrears on their mortgage payments. Furthermore, while Lenders have demonstrated significant forbearance in dealing with arrears over the last year, those arrears are still largely present, and in many cases growing - 159,400 mortgages had arrears of 2.5% or more at the end of last year.

The CML has predicted that there could be as many as 45,000 repossessions in 2012, as rising unemployment brought about by public sector cuts is expected to increase mortgage arrears throughout Northern Ireland and the rest of the UK.

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