CML forecast for repossessions in 2009 is too conservative

Nick Hopkinson, Director of Property Portfolio Rescue, comments on the new statistics on arrears and possessions, published by the CML today: “With no end to the recession in sight and unemployment set to hit three million by the end of the year, there is no doubt that we are going to see another sharp rise in repossessions in 2009. As a result, I believe the CML’s sustained forecast of 75,000 repossessions for 2009 is too conservative.

“Despite efforts from both Government and lenders to assist borrowers in trouble, our data suggests repossessions will more than double this year, easily reaching 82,000 by the end of 2009.

“While lenders are reportedly working more closely with borrowers to find an alterative to taking possession, for those falling into serious arrears, delaying the inevitable could cause more longer term damage. Property prices are expected to fall a further 10 – 15% this year and those that hold onto their home in hope of finding an alternative solution may find themselves even worse off a few months further down the line. For some, the best solution will be to sell their homes now, albeit at a reduced market value, before equity diminishes further and mortgage debt, which will need to be paid back at some point, continues to pile up.”