'Positive signs' see repossession forecast lowered
The Council of Mortgage Lenders (CML) has cut its forecast for home repossessions for the second time this year. The CML now estimates that there will be 48,000 repossessions during 2009, 36% lower than their original estimate of 75,000. If accurate it would mean repossessions would rise by only 8,000 compared to last year.
The CML stated that the "exceptionally low level of rates (had) made it easier for many borrowers suffering payment problems" and that they now expected "only a small rise in arrears in repossessions through to the end of next year".
Commenting on the results Michael Coogan, CML’s director general said: "We are glad to have been wrong on our previous forecast for mortgage repossessions this year. Although the economy is not out of the woods yet, we no longer expect a dramatic rise in properties being taken into possession unless interest rates rise from the low levels that most commentators now expect to persist for some time."
David Marshall, business analyst with ESPC said: "The threat of repossession is one of the biggest fears people face during a recession, so the fact that we are looking at far lower numbers than had originally been projected will come as a relief to many. Recent figures on the housing market have continued to paint a picture of steady improvement. People should not expect a return to rapid house price inflation – and such rises would be unsustainable in the longer term in any event – but the outlook now is much brighter for homeowners than it was 12 months ago."