The number of residential properties taken into possession grew 10 per cent to a total of 1,380 in the first quarter of the year, according to numbers published by UK Finance.
While this is some way off the near 14,000 recorded in the Q1 2009, and UK Finance says that it is down to a backlog of cases being processed in line with new regulatory requirements, Spicerhaart Corporate Sales managing director Mark Pilling says that he expects this number to continue to increase every quarter.
He adds that he sees the figure “ballooning at the end of the year as borrowers start to run out of options to get themselves out of difficulty.”
In more positive news, with 76,580 homeowner mortgages in arrears of 2.5 per cent or more of the outstanding balance, the first quarter of 2019 can boast of having 4 per cent fewer of these cases than this time last year.
Additionally, a total of 23,520 homeowners were in arrears of 10 per cent or more, which comes to 3 per cent fewer when compared to Q1 2018.
In terms of the buy-to-let market, 4,620 in arrears of 2.5 per cent or more and 1,200 at 10 per cent or more represents growth of 3 per cent and 12 per cent within the same time frame detailed above. UK Finance comments that these increases are from a small baseline and do not indicate a clear trend at this point.
Looking at the overall picture, Harris warns that, “[despite arrears numbers at historically low levels] there is no room for complacency. While interest rates remain at low levels, there is always a chance they could rise. Borrowers must plan ahead and consider how they would cope if this were to happen. Long-term fixed-rate mortgages continue to be popular as they are competitively priced and enable borrowers to gain certainty and help with budgeting.”