1,330 Properties Were Repossessed In The UK During Q4 2019, UK Finance

• UK Finance has released data which has shown an increase of 17% YoY in the fourth quarter of 2019, taking the number of repossessed properties in the quarter up to 1,330.
• Regulatory changes seem to have pushed historic applications stuck in the backlog, as per experts.
• Low rates are also encouraging lenders to repossess properties that can possibly be sold at a better price.

According to figures that have been reported by UK Finance, the last quarter of 2019 saw a surge of approximately 17% on a YoY basis in the number of properties that have been repossessed by mortgage lenders in the country. The total number of repossessed properties for the quarter stood at 1,330, as per the quoted figures.

UK Finance has stated that this increase has stemmed from regulatory amendments which allowed the processing of historic cases that had been in the system for quite some time.

The data reported by the trade body also showed a drop of around 9% in the number of borrowers who had their outstanding balances of more than 2.5% in arrears, to 70,880. The number of borrowers with more than 10% of their outstanding balance in arrears also showed a decline of 9% and stood at 21,770 by the end of the quarter.

The number of buy-to-let properties that had been repossessed in the quarter also rose to 660, an increase of around 20% YoY. Arrears in the buy-to-let segment of the industry also declined, with the amount in arrears for those having 2.5% of their total outstanding balance in arrears reducing by approx. 7% and those having more than 10% of the balance in arrears reducing their amount in arrears by approx. 3%.

According to Mark Harris, who is the chief executive of SPF Private Clients, the drastic fall in interest rates should have made it easier for a greater number of borrowers to make timely monthly repayments on their mortgage loans. Already, according to Harris, the number of mortgage borrowers who have amounts in arrears are at a historic low, and although the number of repossessions has increased in the quarter, it should be noted that these have occurred at the lower base levels of the market.

Harris believes that the group of mortgage borrowers who are likely to continue facing financial difficulties is that of mortgage prisoners, and has highlighted that both lenders and regulators need to collaborate and work out a solution to help such borrowers.

Jeremy Leaf, who is an estate agent working in North London, believes that, due to an improving market, the number of repossessions is likely to continue its uptrend as lenders start taking an active approach towards properties that they believe are likely to command an even better price if resold.