Mortgage repossessions fall 20% in second consecutive drop

Mortgage repossessions of private and buy-to-let properties fell for the second year running, according to new figures.

Banking trade body UK Finance says there was a 3% increase from the second to the third quarter this year, but the total was still down 20% from 12 months earlier.

The overall number of 1,840 is down on previous years as well, UK Finance says.

Homeowner repossessions dropped 17% year-on-year and unchanged on the quarter, remaining at their lowest level since quarter 4 2024.

Whilst buy-to-let possessions increased 10% on the quarter to 690, but remained 23% below a year earlier.

Mortgage arrears

Meanwhile, the number of homeowner mortgages in arrears fell for the tenth consecutive quarter in Q3 to 76,080, down 10% on the year and 2% from the previous quarter.

The number of buy-to-let arrears was also down 22% year-on-year and 3% from quarter 2.

Vast majority

James Tatch, Head of Analytics at UK Finance, says: “The latest arrears and possessions data shows that borrowers are continuing to manage their mortgage payments despite rising cost pressures.

“With homeowner arrears falling for a tenth consecutive quarter, and possessions well below historic highs, the overall picture is one of a resilient mortgage market, with the vast majority of customers continuing to make their repayments on time.”

Key challenge

Ian Harris, President of NAEA Propertymark, says: “It’s encouraging to see mortgage arrears continuing to fall for both homeowners and buy-to-let landlords, with property possessions also significantly lower than a year ago.

“This demonstrates the resilience of borrowers despite ongoing economic uncertainty and cost-of-living pressures.

“However, affordability remains a key challenge for the housing market. Mortgage costs and wider household expenditure continue to influence buyer confidence and people’s ability to move home.”

Repossessions fall but affordability fears remain