Property News > The Number of Repossessions and Home Arrears Fall

The Number of Repossessions and Home Arrears Fall

New information from the Council of Mortgage Lenders (CML) shows that the number of UK properties that were repossessed in 2016 fell by 25% and a clear reduction in arrears has been noted. Last year’s 7,700 repossession cases is the lowest number since 1982 and 25% less than the total in 2015: 10,200. Equally as impressive, mortgage arrears were seen to fall by 7% across the country. Unfortunately, comparing the figures on a yearly basis doesn’t give the most accurate information due to the lengthy process of court cases etc linking to repossessions – some cases may have begun in 2014 and concluded in 2015 to mire the figures somewhat.However, at the end of last year there were just 94,100 mortgages with arrears of more than 2.5% of the total balance which is an impressive reduction on the 2015 end of year figures: 101,700. A similar trend was noted for the modest 5% arrears mortgages but, sadly, there was an increase in the number of mortgages exceeding 10% arrears in 2016 – from 23,700 to 26,000. Buy to let mortgages were unchanged in the final quarter of 2016 but the number in arrears has fallen by 11% when compared to the closing months of 2015. It appears the issue is in the owner occupier mortgage market as arrears were noted on 89,200 mortgages, up from 88,300 at the end of 2015.600 buy to let properties were repossessed in the final quarter of 2016 which is significantly lower than in 2015 but 1,200 owner occupier homes were taken into possession in the final quarter of 2016. This may be down on the year as a whole, and the conclusion of 2016, but it shows the issue still remains.It is encouraging to see reductions across the mortgage arrears market but the figures are still very worrying given the number of affected mortgages. To see increases in the more severe arrears mortgages across the year is very concerning – the lower end of the arrears may not face repossession right away but it is an issue that also needs addressing.In the coming months, proposed tax relief on mortgages will come into play and should alleviate the stress on many mortgage borrowers. It may not resolve the issues but it will no doubt offer breathing room for those who obviously need it.Forecasts suggest the tax relief should reduce the number of mortgages in arrears and repossession figures for the start of 2017 but it relies on the borrowers taking responsibility for their owings.

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