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Land Registry Data Show Property Values Not Rising As Fast As PredictedLand Registry Data Show Property Values
Not Rising As Fast As Predicted

Data from the Land Registry’s House Price Index (HPI) in March 2014, shows that overall annual UK property values have increased by just 5.6%, taking the average UK property value to £169,124 (GBP).

The monthly change from February to March 2014 actually shows a property value decrease of 0.4%, however London saw property values increase by 12.4%, while the Eastern and North East regions experienced their greatest monthly rise, with property values rising by 1.1%.

Wales was the only UK region to experience an annual price drop of 1.6% and was also the only region that showed the most significant monthly price fall with values down 4.2%.

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The much debated north-south divide could hardly be more apparent than when it comes to housing. It’s widely accepted that England has an almost two-speed housing market: in the south east, real estate is as much an investment as a home, creating a frenzy of competition between investors, foreign buyers, locals and commuters that keep house prices high. Houses further north can be a fraction of the cost, with prices dropping, more homes standing empty and high levels of housing debt.

The natural conclusion might be that the lower prices mean that housing in the north is more affordable. In reality, affordability is about the money you take home each month versus the cost of your home. The money in your pocket is most often determined by the local jobs market and average wages, which can be totally out of step with the cost of housing in a particular region. On a more local scale again, the picture can become even more complicated – a recent IPPR report into housing in Bradford, for example, found that those in the poorest and cheapest areas of the city spent proportionately more of their income on rent.

Shelter has just released new research showing where the nation’s repossession ‘hotspots’ are – those areas where the highest proportions of homeowners are at serious risk of losing their homes. We find huge variation across the country, with the greatest number of hotspots clustering around the North West and the North East, and a couple of stand out areas in the south, including Barking and Dagenham, Lewisham and Thurrock.

Click here to explore the interactive map of hotspots from Shelter.

Of the top ten hotspots nationally, five are in the north west. What does this tell us? Firstly, the cluster of repossession risk hotspots in the north reflects economic conditions, to some extent. Home repossessions are often triggered by job loss or other loss of income, and our analysis shows that unemployment is higher, and has risen faster, in the areas where risk of repossession is highest.

More recently this has been exacerbated by the ongoing squeeze on household finances. Housing costs take up a large chunk of most people’s take-home home pay. We know that many families have made huge sacrifices – including cutting back on food and fuel – to keep up their mortgage payments. But ultimately if your pay isn’t rising and the cost of everything else is, it’s difficult to keep budgets on track.

The high cost of housing affects all of us. While prices might be most out of control in London, Shelter’s research clearly shows that the northern market is dysfunctional too, with worryingly high numbers of households falling behind on their mortgages and facing the threat of repossession.


New figures released by the Council of Mortgage Lenders (CML), show that the number of residential property repossessions remained relatively stable in the first quarter of this year.

According to the CML, some 9,600 residential property repossessions were recorded in the first three months of 2012, approximately the same amount recorded in the same quarter in 2011, although repossession statistics are up by 10% on the fourth quarter of 2011.

The CML have stated that the results of their findings correspond with a typical seasonal trend in UK property.

As a direct result of its findings for the first quarter of the year, the council of mortgage lenders may have to revise the repossession forecast for 2012 downwards from the expected 45,000 repossessions.

However, in a statement, the organisation added: “Continuing pressures on household finances, changes to welfare benefits and an upward drift in mortgage rates all have the potential to disrupt the current stable picture.”

The CML also indicated that the first quarter of 2012 saw a drop in the number of mortgages with arrears of 2.5% or more of their outstanding balance, dropping from 160,300 to 157,800 on a quarterly basis.

UK property repossessions increase

UK Property Repossessions are forecast to increase 22% in 2012

UK Property Repossessions are forecast to increase 22% in 2012

Economists expect the recession and rising unemployment to squeeze the already stretched household finances of thousands of struggling families this year and are warning UK homeowners and landlords of a sharp rise in residential property repossessions.

Record low Bank of England (BoE) interest rates and lower than expected unemployment figures kept property repossessions to relatively small numbers through the worst days of the first half of the recession and they eased again as the country struggled into a tepid recovery.

However, with a double dip recession inevitably looming, workers incomes failing to cover spiralling household costs, the Government’s economic cutbacks and welfare reforms starting to bite whilst the beleaguered private sector fails to replace jobs lost in the public sector, economists are fearing the worst.

The Council of Mortgage Lenders (CML) had already forecast a 22% rise in UK property repossessions for 2012 increasing the annual property repossession figures to around 45,000.

The property repossession figures include private residential properties where mortgage payments have lapsed and Buy-To-Let properties where landlords did not have <a title=”Landlord Insurance” href=”” target=”_blank”>Rent Guarantee Insurance</a> and have been unable to keep up with their buy-to-let mortgage repayments due to their tenants not paying the rent.

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BTL mortgage arrears feared by UK landlords as tenant rent arrears increase

PRS Rent Arrears Set To Rise Again in 2012

Rent Arrears are set to rise in the UK Private Rented Sector, (PRS), during 2012 as more landlords face dealing with tenants who cannot afford the rental payments on their residential property.

The UK media reported at the end of last year that the number of court orders to evict tenants had risen by 11% during 2011.

In fact, in the last quarter of 2011:
• 78,970 tenants had rent arrears, with 11,400 more tenants over 8 weeks in arrears than in the same period of 2010, a rise of 18%.
• 24,966 tenants were in the process of dealing with eviction notices, an increase of 11% (22,558 in 2010).

A growing number of tenants face deepening financial difficulties, with many tenants jobs and prospects affected by the UK’s economic malaise and with the implementation of the Government’s Welfare Reforms, the number of tenants facing severe arrears and eviction is set to rise further.

The growing level of tenant’s rent arrears has yet to filter through into Buy-To-Let mortgage payment problems for landlords, but this could change in 2012.

In the last quarter of 2011, the number of Buy-To-Let mortgages more than 3 months in arrears fell by 7% compared to the previous quarter, representing an annual decline of 17%.

However, at 26,300, there are still more than five times as many Buy-To-Let mortgages in severe arrears compared with the same quarter of 2006.

Record low, 0.5% Bank of England (BoE) interest rates have kept monthly payments low for those with BTL mortgages tracking the base rate, but there has also been a change in the behaviour of UK landlords. With a healthy rental income becoming the most important component of a property investor’s annual return. Rental income that is sufficient to not only cover the landlord’s mortgage but also provide the landlord with some cashflow.

Landlords are becoming less tolerant of tenants payment problems, and many are seeking eviction as soon as the tenant’s rent arrears reach 8 weeks, using court orders to replace tenants quickly in expectation of finding a financially sound substitute.
UK landlords anticipate that in 2012 due to a growing number of factors, both overall rent arrears and severe rent arrears will rise, leading to increased tenant evictions, hampering the landlords ability to meet their monthly mortgage costs.

This situation that could lead to many disgruntled landlords leaving the Private Rented Sector and a huge increase in Buy-To-Let repossessions.

Legal 4 Landlords offer UK landlords a number of solutions to help them manage their rental property business better.

As well as being the fastest growing UK eviction specialists, Legal 4 Landlords offer a wide range of landlord services including specialist insurance for landlords and Rent Guarantee Insurance.

The volume of scheduled foreclosure auctions reached a nine-month high last month, suggesting that in early 2012 more homes in USA will be seized by banks or offered as short sales, in which lenders agree to accept less than the balance of a mortgage.

Although highly unfortunate for the victims, the distressed nature of the foreclosure property market in the USA presents purchasers with a unique opportunity to buy bargain priced properties in USA.

James J. Saccacio, chief executive officer at RealtyTrac said: “The first quarter typically is a better buying season, so you’ll see more of this inventory try to come to market.

“I expect 2012 to look similar to 2011 in volume if nothing changes with government intervention or regulations.”

Fresh figures provided by RealtyTrac, which publishes the largest database of foreclosure, auction and bank-owned homes, shows that a total of 224,394 properties received notices of default, auction or repossession last month.

RealtyTrac estimate that the U.S. housing market must digest over 14m distressed homes before the foreclosure crisis will improve. This includes around 1.5m homes in the foreclosure process, 3.5m with delinquent mortgages and at least 10m “underwater” properties.

Nevada led the nation with the highest foreclosure rate for the 59th straight month even as foreclosure notices fell 43% year-on-year, according to RealtyTrac.

California had the second-highest foreclosure rate, with one in 211 homes receiving a filing in November.


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UK mortgage holders under pressure to keep up with property repayments may soon breathe easier if new recommendations on home repossessions are adopted.

The Building Societies Association, (BSA), has suggested to the UK Government that the cost of property repossessions is becoming excessive, both in emotional and financial terms, and wherever possible, should be prevented.

The BSA hope that with a policy that aims to avoid property seizures in place, in time, could lead to more UK property investment by homeowners, investors and landlords.

It said the practice of seizing indebted property can be stopped if the Government, banking industry and consumer groups all work together. All parties have role to play in preventing ordinary people from having their homes repossessed.

To encourage discussion on the proposal the Building Societies Association has published a new report –  A Joined-Up Approach To Helping Mortgage Borrowers.

It contains recommendations on lender forbearance, government schemes, flexible tenure and insurance.

The BSA’s head of mortgage policy, Paul Broadhead, said: “It is clear that there is no silver bullet to eliminate repossessions. Instead we need a framework of solutions which together can help as many mortgage borrowers as possible to remain in their homes.”

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