UK Homeowners Losing Homes Due to Non-Payment of Mortgage
A report by The Daily Telegraph
A report published by the British newspaper The Daily Telegraph reveals that hundreds of homeowners in the UK have lost their homes due to non-payment of monthly installments. This is a result of a significant increase in interest rates, which has led to higher monthly payments that homeowners are unable to meet.
Increasing Defaults on Payments
Based on official data and statistics, hundreds of homeowners have defaulted on their mortgage payments and banks have been forced to repossess their properties. The report states that about 440 leased properties were seized in the second quarter of this year, a 7% increase from the beginning of the year.
Rise in Distressed Mortgages
Data from UK Finance, the Merchant Banking Authority, shows that the number of distressed mortgages bought by owners to rent has jumped 28% in the three months to the end of June and 59% year-over-year.
Increase in Mortgage Defaults
A total of 8,980 homeowners defaulted on their mortgage payments during this period as the cost of credit began to rise. There are now more than double the number of homeowners in the lowest indebted group compared to last year.
Market Consequences
Experts predict that the high mortgage rates will significantly impact the market. Louis Shaw of Shaw Financial Services stated, “This is a sign that we are entering a new phase and the market will continue to deteriorate through 2024 as more than 1.4 million households face remortgages at much higher rates than anyone is used to.”
House Prices Falling
House prices in the UK fell more in July than at any time since the global financial crisis in 2009. A survey by the Royal Institute of Certified Surveyors revealed that half of property sellers in England and Wales had to lower their asking prices in order to find buyers.
Impact on Landlords
Rising interest rates and changes in taxes are forcing landlords to raise rents. Some landlords are even leaving the market, resulting in lower rents for apartments.