The latest survey results from the Council of Mortgage Lenders show a further fall in the number of mortgages in arrears, as well as the number of repossessions, in the third quarter of the year.
The proportion (and number) of borrowers behind with their payments fell across each of the arrears bands. A total of 149,400 mortgages, representing 1.33% of the entire stock of mortgages, had arrears equivalent to more than 2.5% of their mortgage balance at the end of the third quarter. This was down from 154,900 (1.38%) in the second quarter, and 159,100 (1.4%) in the third quarter of 2012.
The repossession rate also fell from 0.07% in the third quarter to 0.06% in the fourth quarter, its lowest level since the CML began publishing quarterly data at the beginning of 2008. At 7,200, the quarterly number of repossessions was also the lowest since quarterly data began – down from 7,600 in the second quarter and 8,200 in the third quarter of last year.
The CML figures cover both home-owner and buy-to-let arrears and repossessions. Arrears in the buy-to-let market are lower than in the home-owner market. While buy-to-let mortgages represent over 13% of the total number of mortgages in the UK, the sector accounts for only 9% of the total number of mortgages in arrears. However, the repossession rate is a little higher on buy-to-let than on home-owner mortgages (0.10% on buy-to-let compared with 0.06% on home-owner-mortgages). Of the 7,200 total repossessions, 1,500 were buy-to-let.
Overall, the total number of repossessions for the full year now looks likely to be fewer than 30,000, compared with the CML’s start of year forecast of 35,000. And the CML’s current forecast of 37,000 repossessions in 2014 will also be revised downward when the CML housing market forecasts for next year are published in December.
Mortgage advice in Edinburgh – Integrity IFA.
