Housing arrears fall four percent year-on-year in Q1

Within the group in arrears, there were 23,520 homeowner mortgages with more significant arrears, owing 10 percent or more of the outstanding balance. This was three per cent less than in the same quarter of 2018.

The proportion of homeowner mortgages in arrears remains at historically low levels, the industry body said, with the majority of borrowers continuing to repay their mortgages in full and on time each month.

Elsewhere in the mortgage sector, there were 4,620 buy-to-let mortgages in arrears of 2.5 percent or more of the outstanding balance in the first quarter of 2019, three percent greater than in the same quarter of the previous year.

Within the total, there were 1,200 buy-to-let mortgages with more significant arrears (representing 10 per cent or more of the outstanding balance). This was 12 percent greater than in the same quarter of the previous year. While we are seeing mixed signs in buy-to-let arrears, these do not indicate a clear increasing trend at this stage. Additionally, increases are small and from a low base.

Some 570 buy-to-let mortgaged properties were taken into possession in the first quarter of 2019, 14 percent fewer than in the same quarter of the previous year.

1,380 homeowner mortgaged properties were taken into possession in the first quarter of 2019, 10 percent greater than in the same quarter of the previous year, but well below the levels seen between 2009 and 2014.

Mark Pilling, managing director of Spicerhaart Corporate Sales, said: “As a result of recent regulatory changes, there are many private landlords looking to get out of the sector, and this rise could be down to the fact that some tenants who have been given notice are now not making their rent payments.

“In terms of residential mortgages, arrears are down slightly – although those in arrears of 10 percent or more remain fairly static – but possessions are up by 10 percent, a fairly significant increase. And while they are still not at the levels seen after the financial crisis, they are slowly creeping up.

“And I think we will now see these residential possession numbers continue to increase every quarter, ballooning at the end of the year as borrowers start to run out of options to get themselves out of difficulty. And while forbearance is still an option for some, lenders need to look at all the circumstances of each customer and get the right strategy in place.

“We work with lenders to manage their arrears and repossessions and find solutions that best suit them and their customers. Lenders should try and identify any borrowers who are already having difficulties managing their mortgage – or are likely to in the future – and take action before repossession becomes the only option.”