Repossessions fell in 2014 to their lowest level since 2006, figures from the Council of Mortgage Lenders has shown, with fewer borrowers behind on their payments than before the crash.
According to the data, the total for last year of 21,000 was a decline of a quarter on the 28,900 total for 2013, and the repossession rate of 0.19 per cent for last year was also the lowest since 2006.
Owner-occupied properties were 16,100 of the total, with buy-to-let property repossessions totalling 4,900.
At 0.3 per cent, the repossession rate on buy-to-let mortgages was slightly higher than the 0.17 per cent on owner-occupier loans, despite the fact that the underlying arrears rate was lower on buy-to-let lending than on home-owner lending.
Mortgage arrears also improved last year, with fewer people behind in payments at the end of 2014 than at any time since 2006, the data revealed.
The CML figures showed that just 1.05 per cent of all mortgages were in arrears of 2.5 per cent or more of the mortgage balance, down from 1.29 per cent at the end of 2013, and 1.12 per cent at the end of the third quarter of 2014.
This represented 116,800 loans – down from 124,400 at the end of the third quarter, and 144,600 at the end of 2013 – and may have been helped in part by protracted low interest bank base rates of 0.5 per cent.
However, third-party mortgage administrator Homeloan Management has forecast that repossessions may rise in 2015, especially if there is a rise in bank base rates. Data from HML has predicted repossessions may hit 20,606 in 2015.
Greater London is expected to experience the highest number of repossessions, at 2,641, with Northern Ireland forecast to have the highest repossession rate at 0.49 per cent. The region with this year’s fewest expected repossessions is the East Midlands, with 1,027.
Jonathan Harris, director of London-based mortgage broker Anderson Harris, said: “There are still tens of thousands of homeowners being repossessed each year, which begs the question: What will happen when interest rates do start to rise? How will people cope?
“We suspect that when it comes to their finances there are many people teetering on a knife edge, and rate rises could easily push them over. Interest rate rises are inevitable at some point; when they come, they must do so gradually.”
CML arrears data
YearNumber of mortgagesNumber of mortgages % of total
outstanding more than 12 months