Home repossessions fell significantly to 36,200 in 2011, their lowest level since 2007.
So says the Council of Mortgage Lenders today. They also state that, at 159,400, cases of mortgage arrears stood at 2.5% of all UK mortgages at the end of last year, some 7.5% down on 2010 levels.
Strangely though, ‘buy to let’ repossessions increased last year from 4,900 to 5,700 even though the ‘buy to let’ arrears rate itself has actually fallen to under 2% of all such loans. With rental values at a high, it is somewhat unsurprising that fewer landlords are struggling to pay their way.
But the increase in those handing their keys back is perhaps indicative of value drops in certain areas whereby those investors are in negative equity and have simply decided to bail out rather than waiting for values to recover. The psychological stress of maintaining a project that is likely to stay in ‘loss’ for years getting the better of their financial stamina. Many amateur landlords embarked upon a lettings route for short term capital gain at the height of the property market and are not in it for the long haul, even though as ever, values will inevitably recover.
But the general indicator here is evident. Fewer people are struggling to pay their mortgages. And austerity notwithstanding, with interest rates set to continue at such a low level, this trend is bound to assist in buoying the property market through 2012.
Great to have some good news in property!