Repossessions up to Eight_year High

Repossessions up to Eight-year High

Repossessions are up to an eight-year high according to the Council of Mortgage Lenders.

Repossessions in 2007 were the highest since 1999 although the figures were 10 per cent lower than expected.  A total of 27,100 homes were repossessed compared with 22,400 in 2006.  The number of homes repossessed in the second half of last year was almost identical to the first half at 13,500 compared with 13,600.

Our view

It is difficult to forecast the level of arrears and repossessions in 2008, but it is likely to be much higher as a result of wider issues in the economy and wholesale mortgage funding markets.  The credit crunch as they call it, we prefer to call it the credit squeeze, is upon us.  People will find it harder to borrow in the coming few years.  As a result, repossessions will go up and people will not be able to simply borrow elsewhere to consolidate what debt they have.

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