Home repossessions forecast slashed
Updated on 12 November 2009
The forecast number of people who will lose their homes this year has been slashed by more than a third by the Council of Mortgage Lenders (CML).
The group expects 48,000 properties to be repossessed in 2009, after a combination of low interest rates, Government help and lender forbearance helped people struggling with their mortgages stay in their homes.
But although the figure is well down on the CML's original prediction of 75,000, which was revised down to 65,000 in June, it would still be the highest number since 1995.
The revised forecast came as the group released figures showing the number of people who had their homes repossessed rose by only 3% during the third quarter of the year, despite rising unemployment.
Around 11,700 homes were taken over by lenders during the period, up from 11,400 during the previous three months, but down on the first quarter's total of 12,700. There was also a fall in the number of people who fell behind with their mortgage repayments.
Around 194,600 people were in arrears of at least 2.5% of their outstanding mortgage at the end of September, the equivalent of 1.77% of all mortgage customers, down from 204,200 or 1.86% at the end of June.
The CML said it now expected 195,000 people to be in arrears at the end of this year, well down on its previous forecast of 360,000.
It is also predicting there will be only a modest deterioration in the number of people who are unable to keep up with their mortgage next year, with repossessions expected to rise to 53,000 in 2010, while it predicts 205,000 people will end the year in arrears.
The Ministry of Justice also released figures showing there had been a fall in the number of repossession claims issued to courts in England and Wales during the third quarter. A total of 24,938 claims were issued on a non-seasonally adjusted basis, 6% fewer than during the second quarter of the year, and 34% below the same period of 2008.
CML director general Michael Coogan said: "Low interest rates, and lenders' forbearance policies, have helped to cushion many households facing financial problems. And although the economy is not out of the woods yet, we no longer expect a dramatic rise in properties being taken into possession unless interest rates rise from the low levels that most commentators now expect to persist for some time."
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