The Ministry of Justice has released the latest figures for Q3 2007 concerning possession actions taken in the county court.
The figures show that repossession claims issued rose by one per cent on figures for the same period last year, to a total of 34,717, while also increasing on the 33,183 claims issued in the second quarter of 2007.
But in comparison to last year the orders that were actually made decreased by one per cent to 23,806. However this was still up slightly on the 23,001 recorded for Q2 2007.
Nevertheless, while all this might suggest that interest rate hikes have stretched affordability beyond the means of many, actual court orders do not necessarily result in a home being repossessed.
Repossession To Rise
But with four interest rate hikes since last November, the outlook certainly looks less favourable than a year ago. The CML recorded 14,000 repossessions for the first half of 2007, but believe that this will rise to 30,000 by the end of the year.
They also forecast that financial constraints could up this figure to 45,000 in 2008.
David Stubbs, senior economist at the Royal Institution of Chartered Surveyors (RICS), was similarly pessimistic when he commented: "The number of people entering the early stages of the repossession process remains at elevated levels.
"However the numbers have barely changed over the past year despite the interest rates rises, as people have been able to offload their property into a strong market if they fall behind on their payments.
"As the market slows into 2008 we expect the numbers falling behind on their mortgage re-payments to increase. We forecast that this will lead to 43,000 repossessions in 2008."
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