The latest amendment to the CML’s prediction means that the total figure of expected repossessions has now come down by almost 30,000 from the 75,000 envisaged in the trade body’s housing market forecast last year.
Despite the positive news, the figures published by the CML show that the number of repossessions actually rose by 3% to 11,700 in the third quarter of 2009.
Shelter and Citizens Advice both welcomed the improved forecast, but said the battle was far from over.
Kay Boycott, director of policy and campaigns for Shelter, said: “The combination of low interest rates and Government initiatives have clearly helped stabilise the rising tide of repossessions, but this is no time for complacency or congratulations, as this is still the highest level of repossessions we have seen for over a decade. The CML’s prediction shows growing levels of unemployment will have sustained impact on repossession levels next year and this, coupled with government support schemes potentially coming to an end in the next 12-18 months, means we are not out of the woods yet.”
Peter Tutton, finance policy officer for Citizens Advice, said that lenders showing more forbearance and doing more to help people in arrears – along with guidance from the Government and the CML – was helping people struggling with mortgage repayments, but concerns still remained.
He added: “It is still worrying that 50,000 households have been repossessed and other homeowners are falling behind and struggling on their payments. Lenders and the Government need to keep the focus on helping those in difficulties and being flexible when needed.”
At the same time as it issued its revision of this year’s figures, the CML also outlined its expectations for 2010. It predicts that repossessions will rise slightly to 53,000 cases next year and the number of borrowers behind by 2.5% or more on their mortgage to rise to 205,000 by the end of next year, compared to 195,000 at the end of 2009.
Michael Coogan, director general of the CML, said: “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. Borrowers should take heart from the latest findings as they reinforce the fact that lenders really do want to keep people in their homes and are doing so.”
