Over the past year or so repossession numbers have been declining, which has come as good news for homeowners and for the property industry as a whole. However, according to recent reports repossession numbers are on the rise again after it was revealed that 9,100 properties had been taken back by lenders in the three months leading to the end of March.
Between the last quarter of 2009 and the first quarter of this year repossession numbers had been falling each quarter according to figures, but the first quarter of this year saw an increase of 15 percent in repossession numbers. The Council of Mortgage Lenders has predicted that repossession numbers will continue to rise this year, adding that the figure could go as high as 40,000 repossessions or more over the course of the year.
The low base interest rate is, at present, helping some families to cope with repayments on their mortgages, as it has resulted in their repayments being lower. However, if the base rate increases this could results in an even higher number of repossessions this year, with more people unable to keep up with their mortgage repayments. Officials have put the financial difficulties that consumers are facing down to a range of different factors, such as the government’s austerity drive, the soaring cost of living, a freeze on wages, and higher taxes.
A CML official said: ‘Looking ahead, the financial position of many households is likely to be stretched for some while, and some will inevitably find themselves in difficulty. Lenders have a range of options to nurse borrowers through temporary problems, but will clearly need to be mindful of the regulator’s concern that too much forbearance may be as bad as too little.’
