Mortgage possession actions have continued their gradual upward trend with mortgage claims at their highest since 2019, according to data published today by the Ministry of Justice.Â
Compared to the same quarter in 2023, mortgage possession claims increased from 4,035 to 5,182 (28%), orders from 2,532 to 3,019 (19%), warrants from 2,636 to 2,881 (9%) and repossessions by county court bailiffs from 729 to 759 (4%).
Landlord possession claims also increased from 23,389 to 24,874 (6%), orders from 17,644 to 18,154 (3%), warrants from 10,503 to 11,407 (9%) and repossessions from 6,501 to 6,864 (6%).
What’s more, increases in possession claims have been recorded in all regions.
Private and social landlord claims remained concentrated in London, with six and five of the highest 10 claim rates respectively.
The median average time from claim to mortgage repossession decreased to 45.7 weeks, down from 60.9 weeks in the same period in 2023.
In addition, the median average time from claim to landlord repossession has increased to 24.1 weeks, up from 22.4 weeks in the same period in 2023.
Newspage asked brokers for their views, below.
Reaction:
Craig Fish, director at Lodestone Mortgages & Protection:
“Though this data makes hard reading and is extremely worrying, it’s not unexpected due to the significantly higher interest rate environment in which borrowers now find themselves.
“We are seeing a worsening trend and one, sadly, that is going to continue for some time. What is more worrying, however, is the inability of the decision makers at the Bank of England to see beyond their ivory towers and realise that households and businesses up and down the UK are struggling to make ends meet.
“Things need to change and quickly before it’s too late. We urgently need a base rate cut.”
Justin Moy, managing director at EHF Mortgages:
“Higher mortgage rates have increasingly got a stranglehold on households. While the numbers are still relatively low, these increases highlight how higher rates have impacted mortgage borrowers, and how that trend is worsening all the time.
“This demonstrates the Mortgage Charter hasn’t helped everyone enough, and there will be undue pressure on the state to support the tenants forced to move out as landlords’ properties are repossessed.
“The problem we’re facing is not being tackled effectively and proactively, merely kicked down the road for another government to deal with.”
Ben Perks, managing director at Orchard Financial Advisers:
“I feared this was on the horizon and I’m concerned these figures will continue to rise.
“The Mortgage Charter was a helpful initiative but for many the 12 months grace period is ending and the measures in place didn’t provide the respite that was desperately needed.
“The Bank of England seems totally oblivious to the plight of the average mortgage borrower, but hopefully this data will kick their hesitancy to drop the base rate firmly into touch. The time to act is now.
“The Bank of England must absolutely cut rates in June in order to save many families’ homes.”
Stephen Perkins, managing director at Yellow Brick Mortgages:
“As the cost-of-living crisis and increased mortgage rates continue to bite chunks out of household finances, it is incredibly sad, but unsurprising to see so many families failing to pay their mortgages or rent.
“Many lenders have no choice but to take action against them. With no respite in sight currently, there may still be worse to come in these measures as the year progresses.”
Katy Eatenton, mortgage and protection specialist at Lifetime Wealth Management:
“This is a sorry state of affairs for all the borrowers and tenants affected.
“Rental properties are so important in society and with rates increasing to a level that is unsustainable when you factor in the new taxation rules, it was only a matter of time for this to happen.
“Lenders are trying to help borrowers by reducing rates but increasing fees, but it doesn’t seem to have worked based on this evidence.
“Many households are under immense financial pressure and the Bank of England seems oblivious to that fact.”
Michelle Lawson, director at Lawson Financial:
“Since housing is not taken seriously by the Government, and is not even a senior department, the state of the private rental sector, high interest rates and the damage the Government has caused means these grim figures are not surprising.
“The tenants are the long term sufferers here, too, as landlords are exiting the industry, which is causing a further supply and demand issue that will send rents up further.
“The court system is broken. It shouldn’t take nearly half a year for a landlord to regain possession of their property.
“Tenants are often told to not pay rent o make themselves voluntarily homeless otherwise they are not entitled to council assistance.
“This then adds to the financial pressures of the local councils where we are seeing more and more nearing bankruptcy. It is a disgrace that it has got to this stage.”
Hannah Bashford, director at Model Financial Solutions:
“The report makes for grim reading and paints a bleak picture of the housing situation in the UK.
“We’re still seeing lots of people managing to keep up with the increased costs, but this data would suggest many aren’t, and sadly that ultimately leads to repossession.
“Where do those people then go? Unaffordable mortgages, unaffordable rents, little to no social housing available… when does it end?”
Harps Garcha, director at Brooklyns Financial:
“The spike in living costs and the relentless climb of mortgage rates have really thrown homeowners and landlords a curveball.
“Thanks to the Bank of England’s series of interest rate hikes in recent years, both groups are feeling the pinch when it comes to keeping up with those monthly mortgage payments.
“From my chats with local estate agents, it’s clear to see how many homeowners are feeling the strain, with repossession requests stacking up.
“And to add insult to injury, landlords are finding themselves dipping into their own pockets, even after hiking up rents, just to stay afloat with their investment expenses. Tough times, no doubt about it”
