» Repossessions increase as lending stagnates

Buyers unable to secure funding

Article Published: 19th March 2009

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Whilst there was some good news in the property market with the first signs of prices rising in some areas, there was bad news for many as their homes were repossessed.

Halifax said that they had seen a rise of 1.9 per cent in property prices during January, followed by a slide in value of 2.3 per cent in February. This is a seasonally average figure as prices traditionally rise in January and fall again the following month. Estate agents have reported that there is growing interest in buying properties but the cap on mortgage lending imposed by most borrowers has meant little in the way of increased sales.

Figures showed that repossessions have increased significantly. The total number of homes lost reached 46,760 during 2008, a rise of more than 68 per cent on the previous year.

The FSA also reported that the total amount of loan arrears had increased by just over 10% in the last quarter of 2008 to the previous with 377,000 loan accounts in arrears.

Building societies have also reported a growing number of borrowers who are struggling to meet their mortgage repayments. Paul Broadhead, head of mortgage policy at the Building Societies Association, said that building society’s had an “an unrivalled track record” of giving help to borrowers struggling with their loans and that they should contact their society if they were expereriencing difficulties.