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North of England accounts for half of pandemic property repossessions

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This week our research team can reveal that the North of England has seen by far the most property repossessions since the start of the pandemic, with the North West, in particular, home to the highest level. In this news piece we break down the areas where repossessions have been highest, and what home sellers being affected by financial difficulty and potential repossession can do.

Pandemic Property Repossessions

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Repossessions have continued throughout the pandemic

With the current stamp duty holiday spurring a property market frenzy, house prices have boomed. The latest UK House Price Index shows that the North of England is leading the way, with both the North West (11.9%) and Yorkshire and Humber (10.9%) registering the highest rates of annual growth, while the North East (9%) isn’t far behind.

Against a backdrop of record house price highs and huge levels of buyer demand, it’s easy to forget that not everyone has come through Covid unscathed. Since the start of the pandemic, 4,320 homes have been repossessed across England and Wales.

Property repossessions are executed by a lender, usually the bank or building society, when the owner of a property fails to make the interest payments on any debt secured against their home. You can often stop a repossession or delay it, to buy yourself time to sell it in order to repay debts.

Most repossessions by region

The North West has seen the highest number of repossessions during the pandemic, accounting for 20% of the total number seen across England and Wales. The North East has also seen a large number of repossessions, accounting for 16% of the national total, while Yorkshire and the Humber ranks third at 14%.

Collectively, the North of England has accounted for 50% of all property repossessions seen across England and Wales during the pandemic.

Fewest repossessions by region

In contrast, the East of England has accounted for just 2% of pandemic repossessions, with the South West (6%) and East Midlands (7%) also seeing a low proportion.

How much do properties sell for after repossession?

Traditionally, having your property repossessed would mean it selling on the open market for a far lower price. However, since the government bailed out the big lenders in the wake of the 2008 Credit Crunch, they have been under far greater pressure to prove that they have ‘Treated the Customer Fairly’ (TCF) by achieving the best price possible.

Figures show that this price achieved varies across the country but on average repossessed homes in England sell for around 77% of the average property value. Although the seems low, this is likely because homes that are repossessed tend to be below the average value. In reality, repossessed properties can regularly achieve as high as 95% of market value when resold by the bank according to founder of Yes Homebuyers, Matthew Cooper, who previously worked at an asset management company handling repossession homes for a number of lenders.

Advice for homeowners in financial difficulty

Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented:

“The repossession of a home can be a very traumatic experience and although new guidelines are in place to ensure the lender achieves the highest price possible, it’s the last thing any homeowner wants to go through.

Contrary to popular belief, home sellers in financial distress account for a very small percentage of those opting to use a "sell your house fast" platform such as Yes Homebuyers. While it does provide greater speed when transacting, as well as allowing the homeowner to maintain control of their sale, we actively advise against it if there is a more favourable option available.

Opting for our services should really be the last resort and our advice to any homeowner is be proactive and follow the steps in this article to try to sell your house fast for full market value. Always, always communicate with the lender to let them know you’re doing everything possible and try and buy the time to get a normal sale done for the best price possible. This will put you in the best possible position to get a handle on any debt you owe, while providing the best possible foundations to move forward.”

"

Repossessions have continued throughout the pandemic

With the current stamp duty holiday spurring a property market frenzy, house prices have boomed. The latest UK House Price Index shows that the North of England is leading the way, with both the North West (11.9%) and Yorkshire and Humber (10.9%) registering the highest rates of annual growth, while the North East (9%) isn’t far behind.

Against a backdrop of record house price highs and huge levels of buyer demand, it’s easy to forget that not everyone has come through Covid unscathed. Since the start of the pandemic, 4,320 homes have been repossessed across England and Wales.

Property repossessions are executed by a lender, usually the bank or building society, when the owner of a property fails to make the interest payments on any debt secured against their home. You can often stop a repossession or delay it, to buy yourself time to sell it in order to repay debts.

Most repossessions by region

The North West has seen the highest number of repossessions during the pandemic, accounting for 20% of the total number seen across England and Wales. The North East has also seen a large number of repossessions, accounting for 16% of the national total, while Yorkshire and the Humber ranks third at 14%.

Collectively, the North of England has accounted for 50% of all property repossessions seen across England and Wales during the pandemic.

Fewest repossessions by region

In contrast, the East of England has accounted for just 2% of pandemic repossessions, with the South West (6%) and East Midlands (7%) also seeing a low proportion.

How much do properties sell for after repossession?

Traditionally, having your property repossessed would mean it selling on the open market for a far lower price. However, since the government bailed out the big lenders in the wake of the 2008 Credit Crunch, they have been under far greater pressure to prove that they have ‘Treated the Customer Fairly’ (TCF) by achieving the best price possible.

Figures show that this price achieved varies across the country but on average repossessed homes in England sell for around 77% of the average property value. Although the seems low, this is likely because homes that are repossessed tend to be below the average value. In reality, repossessed properties can regularly achieve as high as 95% of market value when resold by the bank according to founder of Yes Homebuyers, Matthew Cooper, who previously worked at an asset management company handling repossession homes for a number of lenders.

Advice for homeowners in financial difficulty

Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented:

“The repossession of a home can be a very traumatic experience and although new guidelines are in place to ensure the lender achieves the highest price possible, it’s the last thing any homeowner wants to go through.

Contrary to popular belief, home sellers in financial distress account for a very small percentage of those opting to use a "sell your house fast" platform such as Yes Homebuyers. While it does provide greater speed when transacting, as well as allowing the homeowner to maintain control of their sale, we actively advise against it if there is a more favourable option available.

Opting for our services should really be the last resort and our advice to any homeowner is be proactive and follow the steps in this article to try to sell your house fast for full market value. Always, always communicate with the lender to let them know you’re doing everything possible and try and buy the time to get a normal sale done for the best price possible. This will put you in the best possible position to get a handle on any debt you owe, while providing the best possible foundations to move forward.”

See data & sources

Repossession data: Gov.uk  (Feb to Dec 2020 - latest available data)

Average repossession price data: PropertyData

Average house price data: UK  House Price Index

Data table showing the number and value of repossessions in different areas of the country

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