2013 repossession rate lowest since 2007, says CML
Published: 13 February 2014
The number and proportion of mortgages ending in repossession was lower in 2013 than in any year since 2007, according to the latest data from the Council of Mortgage Lenders. At 28,900, the number of repossessions represented 0.26% of outstanding mortgages.
This compares with 33,900 repossessions and a rate of 0.30% in 2012. Repossessions have been falling steadily since their most recent peak in 2009 of 48,900 (0.43%), aided by the beneficial effect of low interest rates, relatively strong employment, and effective arrears management.
Possessions, buy-to-let and owner occupied markets
Mortgage arrears have also declined. As at the end of 2013, 1.29% of all mortgages were in arrears to the value of at least 2.5% of the loan balance (that is, at least £2,500 arrears on a £100,000 loan). This compares with 1.40% of mortgages at the end of 2012, and a peak of 1.88% in the second quarter of 2009.
Encouragingly, there has been a decline in the number of arrears cases across all categories, including the deepest arrears band of 10% or more of the mortgage balance. This arrears band fell year-on-year for the first time since the third quarter of 2010.
As at the end of 2013, 28,700 mortgages (0.26% of all mortgages) were 10% or more in arrears, down from 29,200 at the end of the previous quarter and 28,900 at the end of 2012.
Arrears on mortgages, by percentage of total balance in arrears
Commenting on the new figures, CML director general Paul Smee said:
"Mortgage arrears and repossessions continue to fall, with low interest rates, relatively strong employment, and lender practices all combining to keep most people in their homes even if problems arise.
"Lenders recognise that temporary changes to circumstances can knock households off track - we only need to look at the experiences of households affected by flooding right now to realise that life can contain unpleasant and unforeseen shocks.
"Anyone facing difficulty should talk to their lender, who will try to work with them towards a plan that will get them back on track so that they can sustain their home-ownership for the long term."
Notes to editors
1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 95% of all residential mortgage lending in the UK. There are 11.2 million mortgages in the UK, with loans worth over £1.2 trillion.
2. CML arrears and possessions figures are for the UK as a whole. No breakdown of data is available for the regions or for individual countries within the UK.
3. The Ministry of Justice's mortgage and landlord possession statistics can be found on the Ministry of Justice website. This includes Quarterly National Statistics on possession claim actions in county courts by mortgage lenders and social and private landlords.
4. CML arrears and possessions data for the first quarter of 2014 will be published on 8 May 2014.