Repossessions set to soar by a quarter

Home repossessions are set to climb by nearly a quarter this year, a report from the Centre for Economics and Business Research warns.

The quarterly report, released yesterday under the title Consumer and Housing Prospects, predicts more than 33,000 home owners stand to lose their home in this year alone.

The figures represent a stark increase when comparing them with past data. CEBR’s predictions are up 23% compared to the repossession figures from last year, and are a massive 300% increase from 2004.

Yet this year’s forecasts are still well below the figures from the early 1990s when the annual rate of repossessions was at 75,000.

John Ward, managing economist at CEBR, says: “The stark rise in repossessions forecast shows why the chancellor and the Bank of England are so keen to sort out the problems in the wholesale financial markets.

“Unless or until this tap of mortgage finance starts to flow again, the outcome will be a reduction in house prices and an increase in repossessions.”