Abacus Daily Debt News

Repossessions ‘will get higher’

The number of home repossessions is expected to peak at 25,000 to 30,000 a month in 2011, according to one expert.

Ian Shepherdson, an independent economist speaking at the Chartered Institute of Housing Conference and Exhibition, said that while repossessions had actually come down in recent months, unemployment was likely to drive levels up again.

He remarked: "I hope and I think that they won’t go as high as they did in the early 90s … but they will go substantially higher and we are going to have a big repossession wave."

Prices in the housing market are still overvalued and recent results showing increases in the average cost of properties are probably anomalies in an obvious negative trend, he added.

Mortgage providers repossessed 12,800 houses in the first three months of 2009, according to statistics released by the Council of Mortgage Lenders (CML) in May.

This is over 4,000 more than the CML recorded in the first quarter of the previous year.

By Francis Finch