Only a Minority are Repossessed

pickledpink

I know repossessions are on the increase, but when you take things into perspective it's actually a very small minority who are in difficulties.

Here's a piece from the Guardian today:

"Lenders called for calm. The CML is forecasting 45,000 repossessions this year, double last year's, but said: "These numbers remain extremely small when seen in the context of the 11.74m mortgages in the UK."
In 1991, the worst year for repossessions, 75,500 homes were seized, at a time when the number of mortgages outstanding was smaller. "The possession rate now is similar to that of the late 1990s, but remains less than half the rate experienced in the early 1990s," said the CML."

So that means although 45,000 people will be repossessed this year: just under 12 million (or11 million and seven hundred thousand for the math police) will be unaffected by this recent property downfall.

Most people are actually OK

pawpurrs

At the moment but unfortunetly this recession has only just started and only time will tell how bad its going to be for some.
Its all so depressing......... I think personal debt is higher than in the 90s and peeps have bigger mortgages in relation to salarys, although interest rates are lower, I dont know if it will be any better than last time.

Cannon_Fodder

Tell that to the extra 20,000 families who are "homeless". (although some deserve censure for bad judgment, its not all)

Which direction do house prices take, when 20,000 EXTRA forced sales go on the market? (I don't mind, suits me, but I'm not blind to the wider picture)

Reposessions have doubled in a year, the credit crunch is still unravelling, prices have still a way to drop, putting more people into negative equity, so that when they need to re-mortgage they become additional risks of repossession...

...in 12 months time tell that to the extra 20-40,000 additional house-losers, and so on...

"Lenders call for calm" - it was the damned lenders giving out stupid multiples, on non-existant incomes, and/or merging sub-prime business into their books for a quick buck, that has put the market where it is now.

The title will still be factual when it hits 49%, doesn't make it right then, or now.

We are 1/6 of the way into the crash, if the 1989 crash is the example you wish to choose...still a year away from peak repossessions. I personally wouldn't bet on it not doubling again, i.e pretty damn close to matching 1991.

Nothing to be smug about, certainly.

pinkshoes

Cannon_Fodder wrote: »

"Lenders call for calm" - it was the damned lenders giving out stupid multiples, on non-existant incomes, and/or merging sub-prime business into their books for a quick buck, that has put the market where it is now.

No, it was the stupid irresponsible people taking out mortgages that they couldn't afford. No one put a gun to their head and made them buy a house. It doesn't take a genius to look up past interest rates, and work out the average of around 6%, so what on earth did these people think would happen at the end of their fixed period??

Only a fool blames others for their own mistakes.

Yes, they were looking for a quick buck, but that's business, and if anyone mistook a sub-prime lender as anything else, then they were naive.

Cannon_Fodder

I did say...

Cannon_Fodder wrote: »

(although some deserve censure for bad judgment, its not all)

...there are some repossessions caused by redundancy/ill health etc. Its not only/all the 125% muppets (yet).

And it really peeves me that now tax-payers money is going to towards trying to help "kick-start" the market - for whose benefit? Its not mine, not yours. Its the lenders, EAs, developers, some of the repossessed, etc...

...Oh, and Gordon's re-election campaign.

maninthestreet

It's the trend that matters, not absolute numbers - and the trend is for an increasing number of repossessions.

poppy10_2

pickledpink wrote: »

The CML is forecasting 45,000 repossessions this year, double last year's, but said: "These numbers remain extremely small when seen in the context of the 11.74m mortgages in the UK."
In 1991, the worst year for repossessions, 75,500 homes were seized, at a time when the number of mortgages outstanding was smaller.

That's a false comparison. We're still within the first year of the crash, it's not appropriate to compare current repossessions this year to the worst year of the 1990s crash - a fairer comparison would be with 1989.

SquatNow

Banks will be forced to reposess as per the terms of the mortgages.

They don't have any choice in a falling market.

If they delay the repo then they wont get their money back.

If they repo as per the T&Cs they can pass the losses onto their insurers or bond holders.

milliebear00001

Is it not also true to say that in the last recession, interest rates were extortionate and unemployment fairly high? These (as yet) are not features of our economic picture.

wymondham

If you push FTB's to buy a house now, enticed with stamp duty breaks and loan schemes are you not feeding the reposession problem you're trying to cure?

GDB2222

milliebear00001 wrote: »

Is it not also true to say that in the last recession, interest rates were extortionate and unemployment fairly high? These (as yet) are not features of our economic picture.

Interest rates peaked at about double today's rates. On the other hand loan multiples were much lower then, and there is more unsecured debt around now. There was indeed a lot of unemployment in the early 90's.