Landlords of UK buy to let property are increasingly getting repossessed

Landlord Expert
By Landlord Expert August 28, 2012 12:14

 

There were 18,100 repossessions in the first half of 2012, of which 19 per cent were buy-to-let, up from under 10 per cent in early 2009. By contrast the number of owner-occupied homes being repossessed has been in decline since the start of 2009.


The repossession rate – the total number of repossessions in relation to the total number of mortgages – topped 0.24 per cent for the first time in the buy-to-let market, while the repossession rate for owner-occupied properties was just 0.15 per cent, down from 0.22 per cent at the start of 2009.

 

Buy-to-let lending has grown from 5.5 per cent of the mortgage market in 2005 to 12.6 per cent now. Loans on buy-to-let properties increased 14 per cent year-on-year, with £3.9bn lent in the three months to June. The total lent on buy-to-let properties has topped £160bn, driven by demand for rental property as potential buyers find it harder to get mortgages than before the credit crunch.

 

Neal Hudson, a researcher at Savills, said factors contributing to the rise in buy-to-let repossessions included a lack of forbearance from lenders and higher mortgage rates.

 

Buy-to-let properties also tended to incur higher levels of arrears because tenants defaulting and landlords not making provision for unexpected maintenance costs, Savills said.

 

 

 

Landlord Expert
By Landlord Expert August 28, 2012 12:14

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