Whilst the property market may be struggling at present, mortgage arrears and property possessions are now at an all time low figure.
In the third quarter of 2018, there were 77,600 homeowner mortgages in arrears of 2.5% or more of the outstanding balance. This is 5% lower than a year ago.
There were 24,090 homeowner mortgages that represented more than 10% of the outstanding balance which was unchanged from 2017.
In the buy-to-let sector, there were 4,660 mortgages in arrears of more than 2.5%, which represents a 1% reduction on those a year earlier. The 1,150 mortgages in arrears by more than 10% of the outstanding balance is 3% down on 2017 figures.
However, it is the reduction in mortgages taken into possession that really highlights the market improvements. The 1,080 mortgages taken into possession in 2018 is a 19% decrease on the figure a year earlier.
Similarly, the 550 buy-to-let mortgages that were taken into possession highlights 17% fewer than 2017 figures.
Jackie Bennett, Director of Mortgages at UK Finance, commented: “It is encouraging that homeowner arrears and repossessions remain at historically low levels, which shows the vast majority of borrowers continue to repay their mortgages in full and on time each month.
“We would always encourage anyone with concerns about making their mortgage repayments to contact their lender to discuss the advice and support available.”
Although the most recent house price index indicates that house prices are lower than figures in July and annual growth is going to be at its lowest levels in five years, it is optimistic that more people are able to afford their mortgages.
Whilst this is a positive for the housing market, rising interest rates and uncertain wage increases could compromise this continued success in the future.
Should more be done to help those that are struggling to pay their mortgage?