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Improvement in repossession figures

10% fewer homes repossessed

Around 11,400 people had their properties repossessed during the three months to the end of June, 10% fewer than during the previous quarter, according to the Council of Mortgage Lenders (CML).

The CML said a combination of factors helped people who were struggling with their mortgage stay in their property, including low interest rates, increased lender forbearance and a raft of Government schemes.

Upward trend may resume

terrace of houses

However, commentators warned that repossession figures were likely to resume their upward trend during the coming quarters as unemployment continued to rise.

Ed Stansfield, property economist at Capital Economics, said: ‘The news that fewer families lost their homes in quarter two than in quarter one is welcome.

‘However, with unemployment set to rise further and average earnings growth under strong downwards pressure, last quarter’s drop in possessions is likely to prove temporary.’

No room for complacency

The CML also released figures today showing only a modest increase in the number of people falling behind with their repayments, with 205,600 homeowners in arrears of more than 2.5% of their outstanding mortgage debt at the end of June, up from 203,900 at the end of the first quarter.

But the group said there was no room for complacency over the potential scale of future payment problems, and it has previously predicted 65,000 people will lose their homes during 2009 as repossession numbers begin to climb again in the second half of the year.

The Government has introduced a number of schemes to try to help people struggling with their mortgage stay in their home, but some of these initiatives are still at a very early stage.

Read more on how to deal with the threat of repossession.

pound coins

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