Repossessions fall as rates kept low

THE number of homes repossessed in 2009 reached its highest level since 1996 but an unexpected decline in repossessions in the fourth quarter saw the annual figure beat forecasts, the Council for Mortgage Lenders (CML) said yesterday.

A 13 per cent fall in the number of repossessions in the fourth quarter meant that only 46,000 homes were taken back compared to the 48,000 estimated by the CML. Although the figure was almost half what the CML had estimated at the start of 2009, it was still 15 per cent higher than 2008.

Simon Rubinsohn at the Royal Institute for Chartered Surveyors (RICS), said: “This is a result of the low level of interest rates which has kept mortgage funding costs at historically low levels and thus limited the pain on homeowners.”

Meanwhile, the Treasury Committee announced yesterday it would undertake an inquiry focusing on households affected by the recession and struggling with mortgage arrears and/or at risk of repossession.

Shadow housing minister, Grant Shapps said: “The Bank of England has kept many people in their homes by maintaining low interest rates but government schemes haven’t helped the rest.