March 16th, 2020. Jamie Williams
Repossessions Are on the Rise: What Does This Mean for Lending?

New data has revealed that the number of rental properties being repossessed by lenders due to owner arrears is up 40% on last year. Here we examine the figures, reveal why this is happening, and how you can beat the statistics.
Repossessions Are on the Rise
According to figures from UK Finance, the trade body for banking and finance, 4,550 buy-to-let mortgages were in arrears of 2.5% of more of the total borrowing in the third quarter of this year, with a thousand of these in serious arrears of 10% or more. In Q2, 800 were repossessed.
It’s Not All Bad Though
Although these numbers may sound shocking, it is important to remember this represents just a quarter of 1% of landlords and this has not dampened demand for this kind of venture. Furthermore, this figure rises to just over three-quarters of 1% for owner-occupiers.
Although repossessions are up markedly, the total number of buy-to-let mortgages in arrears and ‘at risk’ is actually down 5% on this time last year.
Read more: The State of the UK Housing Market at the End of 2019
What’s Causing These Repossessions?
Well, the recent reduction in income tax relief and the 3% surcharge on stamp duty does not help in an environment with increasingly tighter regulations. Those who are inexperienced are advised to be realistic about costs, to speak to an experienced IFA, and to ensure suitable levels of finance using services like our own.
HMRC reports there are more than 2.5m landlords in the UK with most owning just one or two properties. Howsy states these landlords should have an average annual budget of £2,344 per property to cover the cost of repairs and maintenance, as well as lettings management, or £4,750 in London.
Its CEO, Calum Brannan, commented:
“The buy-to-let sector can be a minefield for the amateur investor and now more than ever, it’s imperative that you do everything you can to maximise the return on your investment.”
A competitive finance deal could help with just that.
Put Your Best Foot Forward
If you are considering investing and want to ensure your profitability, reading ‘A Guide to Commercial Property Investment for Buy to Let Landlords’ is worth your time. Here you’ll find guidance on a number of aspects to consider before investing, including income, leases, running costs, and taxes and fees.
And, if you require funding, our friendly and experienced buy-to-let mortgage brokers can help you to find a deal suited to your specific needs.
Article By Jamie Williams
March 16th, 2020
Jamie is a Sales Manager and a vital part of Pure’s specialist finance team. With over 17 years of experience in the mortgage and specialist finance industry, Jamie is an expert in bridging and development finance, as well as Equity Release, Commercial and Second Charge mortgages. His deep market knowledge, combined with a passion for helping clients navigate complex financial solutions, ensures an outstanding service every time.
Jamie has been with Pure for 8 years, following a successful career at Barclays. His leadership and dedication continue to drive exceptional results for both clients and colleagues.
Outside of work, Jamie enjoys spending quality time with his young family and two dogs. A lifelong Chelsea supporter, he also plays veterans football for his local team.
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