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London leads repossession growth

Fitch Ratings says London is leading repossession growth, with repossessions in the capital at a level not seen since 1996.

London’s repossession growth is followed by Southern and Eastern regions and the remainder of the country, with the latter having bottomed out more recently.

New research on data from the Department of Constitutional Affairs, the Council of Mortgage Lenders and Fitch’s own surveillance data received from issuers, reveals that London was first to see repossession rates start to rise from the historically low levels experienced between 1995 and 2002.

London’s repossession rate is now roughly double those of regions in the North of England, though still far from the levels experienced during the last recession in the early 1990s.

These results form part of a report published by Fitch today on the subject of regional patterns of repossessions in England and Wales.

Gregg Kohansky, head of Fitch’s UK Regional Repossession Study for England and Wales team, says: “We were able to break the data down to county and partly into postcode level.

The broad picture emerging from the data shows that many districts in London are seeing repossessions rise much faster than in other regions.

“With London seeing revived house prices, further affordability stretches are likely to support continued elevated repossession levels in London.”

The special report titled UK RMBS combines various data sources to form an insight into regional developments across the country.

In addition to the publicly available data the report provides also insights into regional performance from a pool of Fitch-rated sub-prime transactions.

Fitch says the long-term picture is fairly clear with a swift increase in London and its surroundings and a more moderate increase in other regions.

However, quarterly growth rates show a lot of volatility in time and across regions, and it urges that they should not be interpreted as general market trends.

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