Posts with tag: repossessions

Large drop in repossession claims in the last two years

Published On: November 11, 2016 at 12:17 pm

Author:

Categories: Landlord News

Tags: ,,,,

There has been a significant fall in the number of claims made by private landlords to repossess property during the last two years, according to new data.

Official figures provided by the Ministry of Justice show that the number of possession claims made to country courts in England and Wales by private landlords have dropped substantially during this period.

Fall in possessions

Data from the report shows that possessions made by landlords have fallen from a high of 6,486 during quarter one of 2014, to 5,129 in the third quarter of this year.

The news of improvements comes after an independent English Housing Survey discovered that in 2014-15, private rental tenants have lived in their current property for an average of four years.

Assessing the data, David Smith, policy director at the Residential Landlords Association, feels the results serve as a reminder that: ‘landlords do not seek to re-possess properties lightly.’[1]

‘With tenants also living an average of four years in private rented homes, the sector is stepping up to the demand for long term housing without the need for heavy handed legislation,’ he added.[1]

Large drop in repossession claims in the last two years

Large drop in repossession claims in the last two years

Orders 

The report also shows that during July and September 2016, landlords made 20,753 possession claims. 60% were from social landlords, with those in the private rental sector making up just 15%.

Landlord possession claims (34,414), possession orders (26,157), warrants of possession (18,450 and repossession claims (9,689) were down by 11%, 10%, 8% and 14% respectively, in comparison to the same period last year.

[1] https://www.landlordtoday.co.uk/breaking-news/2016/11/significant-drop-in-landlord-possession-claims

 

Mortgage Arrears Drop to Lowest Level on Record

Published On: August 12, 2016 at 8:36 am

Author:

Categories: Finance News

Tags: ,,,,

The amount of mortgage arrears has dropped to the lowest level on record, according to the Council of Mortgage Lenders (CML).

Mortgage Arrears Drop to Lowest Level on Record

Mortgage Arrears Drop to Lowest Level on Record

The total number of mortgages in arrears as of June 2016 was 92,600 – down by 13.4% on last year, when it stood at 106,800.

Homeowners with residential mortgages saw arrears of at least 2.5% fall to 87,900 in June, while buy-to-let mortgage arrears dropped to 4,700.

There was also a decline in the number of owner-occupied and buy-to-let property repossessions – from 1,500 to 1,300 for homeowners and from 700 to 500 for landlords.

The CML reports that the number of mortgaged property repossessions is on course to be the lowest since 1982 this year.

The findings arrive as Ministry of Justice data shows that there were 42,729 rental evictions – for both the social and private sectors – in England and Wales in 2015, compared to 5,592 mortgaged property repossessions, despite the fact that rental housing accounts for just one-third of the total housing stock.

The CML believes that lenders try to avoid repossession wherever possible to help owner-occupiers recover from a temporary period of financial difficulty, but landlords may move more quickly to protect their investment properties.

The Director General of the CML, Paul Smee, comments: “Another welcome reduction in arrears and possessions shows that borrowers are continuing to prioritise their mortgage commitments and that lenders remain committed to helping them through a period of temporary difficulty, wherever possible.

“As ever, the key to success in dealing with any payment problems is to address them as soon as possible. Any borrowers anticipating difficulty in paying their mortgage should therefore speak to their lender at the earliest opportunity.”

Buy-to-let landlords must be aware that their finances may be affected by forthcoming changes to mortgage interest tax relief. From April 2017, the amount of tax relief that landlords can claim against mortgage interest will be cut to the basic rate.

Use the Government’s guide to help you prepare for the changes: /government-guide-tax-relief-changes-residential-landlords/

Property Repossessions Rate Drops by Over 50%

Published On: June 3, 2016 at 8:40 am

Author:

Categories: Property News

Tags: ,,,,,

The property repossessions rate has dropped by a huge 51% over the past year, according to the latest study by chartered surveyor e.surv.

The firm found that the gap between repossessions in the north and south has almost halved in the last 12 month.

In 2015, repossessions in the north fell to a rate of 2.1 per 1,000 households, compared to 1.4 per 1,000 in the south. This leaves a gap of just 0.7 between the two halves of the country.

In the previous year, the difference stood at 1.3, as the north recorded a repossession rate of 4.1 per 1,000, while the south saw a rate of 2.8. Therefore, the divide between the north and south has now dropped by 46% over a year.

Across England and Wales as a whole, total property repossessions have decreased by 51% in absolute terms, from 39,928 in 2014 to 19,672 in 2015. The average rate of repossessions is now 1.7 per 1,000 households, down from 3.4 per 1,000 in the previous year.

The Director of e.surv, Richard Sexton, comments on the findings: “Repossession levels are retreating, and the narrowing north-south gap is the strongest sign of this decline. Fuelling these improvements has been the triple combination of rising employment, low inflation and a consistently low base rate. More people than ever are managing to hang onto their homes and keep up with repayment schedules. Alongside this, many homeowners are remortgaging to take advantage of the flurry of new deals on offer from lenders. These factors have significantly helped those struggling across England and Wales to get their finances back on track.

Property Repossessions Rate Drops by Over 50%

Property Repossessions Rate Drops by Over 50%

“The lending market is also playing an important role. This is the era of responsible lending, with prospective homebuyers benefitting from the variety of mortgage options on offer, increased regulatory tests and plenty of advice on how to secure the right deal. The outlook for 2016 seems promising, with increasing numbers of potential buyers finding themselves in a more financially secure position.”

Bolton continues to have the highest repossession rate in England and Wales, a position that it has held since 2004. Within the town, 3.5 per 1,000 households had their homes repossessed during 2015.

Sunderland was not far behind, with a repossession rate of 3.1 per 1,000, accompanied by Oldham at 3.0, Liverpool at 3.0 and Bradford at 2.7 per 1,000 households.

In the north, 73% of towns recorded a higher repossessions rate than the national average. Areas that managed to record a lower rate than average include Carlisle at 1.2, Derby at 1.4 and Leicester at 1.5.

Sexton explains: “The north is battling to change its reputation as a repossession hotspot. Repossessions overall may be dropping, but the reclaiming of homes remains an acutely northern problem. Across the region, almost three-quarters of towns are seeing substantially higher than average repossession rates. Homeowners in Bolton are still, more often than most, struggling to make mortgage repayments and even in Manchester and Liverpool – two of the north’s most prominent cities – repossessions are prevalent. The north has faced heightened challenges to the south in recent years – the loss of public sector jobs, manufacturing industry decline and a tough recession – all of which hit homeowners and potential homebuyers. However, economic conditions in the north are now receiving more attention, with the northern powerhouse initiative and the future promise of devolution drawing more towns into the national spotlight.”

Meanwhile, London recorded the biggest improvement – the repossession rate in the capital dropped by 54% to 1.6 per 1,000 households in 2015, from 3.5 in 2014. The news arrives despite London’s continued struggle with high house prices.

Sexton continues: “London is turning over a new leaf when it comes to repossessions. The capital may boast the country’s highest earners, but still people struggle to keep up with payments. Progress has been made and London’s average repossession rate has more than halved. But there is still cause for concern; some London boroughs are seeing higher rates than the England and Wales average, and there seems to be a fundamental mismatch across the capital. Due to higher house prices, homebuyers and homeowners living in the capital face higher repayments, meaning an unexpected event such as a job loss can have severe financial repercussions more quickly. London is presumed to be the wealthiest region but real poverty remains, meaning repossessions continue.”

Repossession Rate to Stay Low in 2016, According to HML

Published On: May 13, 2016 at 11:33 am

Author:

Categories: Finance News

Tags: ,,,

The repossession rate for homes in the UK will stay low over 2016 if interest rate rises are further postponed as anticipated, according to HML, the UK’s leading mortgage service firm.

Repossession Rate to Stay Low in 2016, According to HML

Repossession Rate to Stay Low in 2016, According to HML

In its annual forecast, the HML said that it expects a total of 10,326 repossessions in the UK during 2016, which would account for 0.09% of mortgages. The prediction arrives as the Council of Mortgage Lenders (CML) reports the lowest level of repossessions on record.

This figure would represent a second consecutive year of low repossession rates, although HML reports that the threat to the UK steel industry could mean more repossessions in South Wales and other regions where jobs are at risk.

The CEO of HML, Andrew Jones, says: “Repossession is an extremely difficult time for any household, and HML works with mortgage providers to identify those at risk and provide support during times of financial difficulty.

“Another year of low repossession rates is welcome, but we shouldn’t ignore the prospect of big increases when interest rates eventually rise.

“Those hit hardest by other financial pressures, such as unemployment, are at particular risk, and if the UK steel industry deteriorates, we can sadly expect repossessions to increase in communities that are affected.”

HML is the only company that publishes mortgage repossession forecasts broken down into the English regions, Wales, Scotland and Northern Ireland.

It expects Northern Ireland to have the highest repossession rate, at 0.27%, in 2016, with the South West and East Midlands having the lowest, at 0.06%.

HML’s figures vary significantly from those suggested by the CML in December last year, which forecast a sharp increase in repossessions, to 18,000.

HML believes that the difference relates to a change in expectation over the timing of interest rate rises, which the CML expected to occur in the second half of 2016, but is now not expected until 2017 at the earliest.

In September last year, HML stated that an interest rate rise would hit first time buyers particularly hard, expecting 20,000 to fall into arrears if the base rate rose by 1.5%.

Although the repossession rate looks set to remain low, concerns have been expressed about rising house prices, as the HomeOwners Alliance reports that the housing crisis is deepening.

Rental arrears and repossessions fall in Q1 of 2016

Published On: May 12, 2016 at 10:51 am

Author:

Categories: Finance News

Tags: ,,,,

According to the most recent report from the Council of Mortgage Lenders (CML), repossessions in the first quarter of 2016 fell to their lowest on record.

Data from the report shows repossessions fell to 2,100, with 1,500 home-owner properties and 600 buy-to-let.

Should this rate continue during 2016, this would put the yearly number of repossessions at 8,400.

Falls

In addition, mortgage arrears continued to drop. For the first time in more than ten years, the number of mortgages in arrears of 2.5% or more dipped below the 100,000 mark.

There were 96,200 loans in arrears at the end of March, falling from 101,700 recorded at the end of December. What’s more, this was significantly down on the 111,200 recorded in the first quarter of 2015.

The decline in mortgage arrears and repossessions in recent years underlines the positivity surrounding the private rental sector. However, further data from the Ministry of Justice shows that eviction rates are much higher.

Statistics show that there were 42, 728 rental evictions in England and Wales by county court bailiffs in 2015. This was against just 5,594 mortgaged property repossessions by county court bailiffs.

Rental arrears and repossessions fall in Q1 of 2016

Rental arrears and repossessions fall in Q1 of 2016

Experiences

A more detailed look at the CML data highlights experience in both the home-owner mortgage market and the buy-to-let market. Arrears rates are greater amongst home-owners than buy-to-let landlords, but the repossession rate is less. Lenders obviously look to avoid repossessions to allow home-owners breathing space. However, many landlords look to protect their position more quickly on buy-to-let as tenants move on.

CML director general Paul Smee commented, ‘we cannot completely avoid the risk of any individual household experiencing arrears or repossession. But lenders continue to work very effectively to help their borrowers through periods of difficulty when they do occur and borrowers should be reassured that most cases of arrears can be resolved and will not lead to repossession.’[1]

Smee believes, ‘the key to dealing with difficulty is to tackle it early and to communicate with your lender as soon as you think you may be facing problems.’[1]

[1] http://www.propertyreporter.co.uk/property/repossessions-and-arrears-continue-to-fall.html

 

Tenant evictions reach highest ever level in 2015

Published On: February 12, 2016 at 9:00 am

Author:

Categories: Landlord News

Tags: ,,,,

An extremely alarming new survey shows that more than 250 tenants were evicted from their rental accommodation in England and Wales during 2015.

Latest Ministry of Justice figures reveal that 42,728 households in rented property were evicted by bailiffs last year. This was the highest number since records began in 2000.

Housing activists point to welfare cuts and the lack of affordable homes for the 2% increase in repossessions in 2015. Over half of these evictions are said to have been by private landlords.

Evictions

Despite the yearly rise, the data also shows that the number of rental properties repossessed actually fell in the final quarter of 2015. 9,775 households lost their home in the three months to December, in comparison to 11,269 in the previous quarter.

In addition, the figures show that the number of evictions rose by 53% in the five years from 2010.

19,093 evictions in England were by social landlords, with 5,919 made by private landlords. A further 16,440 were carried out through the accelerated procedure, which can be utlised by both private and social landlords to evict tenants on assured shorthold tenancies.

Tenant evictions reach highest ever level in 2015

Tenant evictions reach highest ever level in 2015

Repossessions

The borough of Newham in London had the largest rate of repossessions, equivalent to 191 per 100,000 in the region. What’s more, Londoners were most likely to lose their homes, with 16 out of the 20 boroughs with the largest proportion of landlord repossessions located in the capital.

However, the number of repossession claims fell during 2015, to 148,043. Of these, 90,317 were made by social landlords, 20,063 by private landlords and 37,663 were accelerated claims.

‘Today’s figures are clear proof of the devastating impact that welfare cuts and the chronic shortage of affordable homes are having on hundreds of renters every day,’ commented Campbell Robb, chief executive of the housing charity Shelter.[1]

‘Successive Governments have failed to build enough genuinely affordable homes and short-sighted welfare cuts are only making things tougher. The only way to fix this crisis for good is for the Government to commit to building homes that people on ordinary incomes can actually afford to rent or buy,’ Robb added.[1]

Falls

Different figures from the Council of Mortgage Lenders show that repossessions of mortgaged homes were down by nearly half in 2015, to the lowest levels since 2002.

10,200 homes were repossessed during 2015, of which 3,000 were buy-to-let homes. These properties were twice as likely to be repossessed by lenders in the final quarter of the year, at a rate of one repossession per 2,500 mortgages. This was in comparison to one in 5,000 in the homeowners market.

A CML spokesman said that when a homeowner fell into mortgage arrears, the lender would look at a number of options to try and keep the occupant in their home. He said that seeking a repossession, ‘will be the last option,’ for the lender.

Continuing, the lender said, ‘a buy-to-let is taken out by a landlord to invest in property and so is fundamentally different. The borrowers may not have the same range of options. For example, many landlords only borrow on an interest-only basis at the outset, so switching them to cheaper repayments may not be an option.’[1]

‘Lenders must also consider the position of tenants, who may be paying rent to a landlord who is not paying the mortgage. In this case, an option may be to appoint a receiver of rent to fulfil the role of the landlord and ensure that tenants can remain in the property as long as they continue to pay the rent,’ the spokesman concluded.[1]

[1] http://www.theguardian.com/money/2016/feb/11/tenant-evictions-highest-level-england-wales-ministry-of-justice?CMP=share_btn_tw