Property repossessions fall below expectations
UK buy-to-let landlords are taking positive steps to ensure that mortgage payments are met by taking out insurance to guarantee the rent as figures released by the Council of Mortgage Lenders (CML) showed a fall in the number of buy to let and residential property repossessions in the second quarter of 2012.
8,500 properties were repossessed in the three months to June 2012 and is the lowest number since the final quarter of 2010.
The total number of repossessions was 18,100 including rental and private residential properties during the first six months of this year, suggesting that repossession estimates for 2012 could well be lower than the CML’s initial forecast of 45,000 for the year as a whole.
The figures are lower than expected and data released by specialist landlord services provider Legal 4 Landlords suggest that it could in part be due to landlords taking positive action to protect rental income.
Spokesman for Legal 4 Landlords, Sim Sekhon said: “The Buy-To-Let market needs to have some protective elements these days, landlords take out insurance to protect the fabric and contents of their rental property and aim to seek only the best tenants who will take care of it, reducing the risk of expensive repairs. In the current economic climate the financial circumstances of tenants and landlords can be affected without warning and the fallout could cost both parties everything. Landlords seeking insurance to protect rental income makes good business sense and landlords have welcomed our rent guarantee product with record breaking interest; we’ve even had to take on extra staff to deal with the volume of enquiries”.
CML director general Paul Smee said: “The figures show that lenders, borrowers and debt advisers are working together to get through the current period of economic difficulty and keep mortgage possessions in check.”