Home repossessions increase after decades of going down
Figures from the Ministry of Justice reveal increasing pressure on household finances initiating first rise for many years.
Home repossession claims by mortgage companies increased by a third year-on-year during the final quarter of 2018 to 5,648, latest figures from the Ministry of Justice reveal, suggesting the creaking economy and Brexit are beginning to push some struggling households into the red.
Mortgage repossession claims are the beginning of the process and precede warrants, orders and then physical repossession.
Despite the increase, the number of people losing their homes remains at historically low levels, and repossessions of buy-to-let properties decreased by 3%, the Ministry of Justice says.
But five of the highest overall repossession rates in the country are in the North West of England, and 80% of the landlord property repossessions hotspots are in London.
“The latest mortgage and landlord possession statistics show that after years of falling rates, overall repossession actions have increased including orders up by 29% and warrants up 30%,” says Mark Pilling, Managing Director of SpicerHaart Corporate Sales (left).
“This could be the beginning of a more permanent trend. We have already seen a number of new ‘hot spots’ such as Manchester and Blackpool.
“And as people look to move out of London, we could see house prices pushed up even further, impacting affordability and therefore arrears and possessions.”
The Ministry of Justice says recent historical falls in the number of mortgage possessions since 2008 coincides with lower interest rates, a proactive approach from lenders in managing consumers in financial difficulties and other interventions, such as the Mortgage Rescue Scheme and the introduction of the Mortgage Pre-Action Protocol.