Home repossessions in the North of England outstripping the South by 44%

16th April 2014

img

The rate of home repossessions was 44% higher in the North than in the South of England in 2013, according to detailed research by e.surv chartered surveyors.

e.surv’s analysis of court-ordered repossessions in England and Wales in 2013, broken down by post code, found there were 5.6 repossessions per 1,000 households in the North, 44% higher than the 3.9 repossessions per 1,000 households in the South.[1] This compares to 6.3 repossessions per 1,000 households in the North and 4.4 in the South in 2012.

Eight in ten Northern towns (78%) were home to more repossessions than average in 2013. The North West, North East and Wales were repossession hubs in 2013, with 6.0, 5.9 and 5.8 repossessions per 1,000 households respectively. The South West – the area with the lowest number of repossessions per year – experienced the biggest improvement, with repossessions falling 15% over the past year.

Richard Sexton, director of e.surv chartered surveyors, says: “The North is still home to the largest wedge of repossessions, despite improvements in household finances across the country. Both the North West and the North East are still paying the price of recession-driven public sector job cuts – which stimulated a glut of local repossessions. The whole country is now in recovery, but the North has the furthest to go to catch up, and is comparatively lagging behind.”

There is some brighter news too with repossessions falling in every region

Total repossession court-orders fell 10% from 59,588 in 2012 to 53,325 in 2013. On average, there were 4.7 repossessions per 1000 households in 2013, down from 5.2 in 2012. Repossessions fell in every region of England and Wales.

Sexton adds: “The economic recovery has truly taken hold. Rock-bottom interest rates have enabled home-owners to pay down debts, and mortgages have become much cheaper, which has eased the pressure on household finances. Repossessions have fallen rapidly as a result. The labour market is picking up pace and real wages are expected to start growing in the next few months. That will further free up finances.

“There is one looming challenge which could throw the repossessions recovery off course. At some point soon the Bank of England may choose to raise the base rate. A higher base rate will translate into higher repayments for many, which could tip a whole host of borrowers into the red. The base rate rise may cause repossessions to temporarily bounce back.”

image007

Repossessions by region

Region

Repossessions/1,000 households in 2013

Repossessions/1,000 households in 2012

% change

North West

6.0

6.8

-12%

North East

5.9

6.4

-8%

Wales

5.8

6.5

-11%

Yorkshire & the Humber

5.5

6.2

-11%

West Midlands

5.3

5.7

-8%

London

4.7

5.1

-8%

England & Wales Average

4.7

5.3

-11%

East Midlands

4.6

5.3

-13%

East of England

3.8

4.3

-11%

South East

3.6

4.0

-10%

South West

3.1

3.7

-15%

Repossessions by postcode area

In total, 86% of towns in the North West had more repossessions than the average in England and Wales in 2013. In fact, five of the worst ten towns for repossessions were in this region. North-West town Oldham had the highest rate of repossessions – with 8.6 repossessions per 1,000 households – almost double the average number in England and Wales (4.7). Other North West towns in the top ten repossession postcodes included Wigan (4th highest with 7.4), Blackpool (5th highest with 7.0), Liverpool (9th highest with 6.9) and Manchester (10th highest with 6.8). 

Top Ten Repossession Postcodes

Postcode area

Repossessions/1,000 households in 2013

Total number of repossessions in 2013

Oldham

8.6

747

Romford

7.8

754

Bradford

7.4

835

Wigan

7.4

460

Blackpool

7.0

477

Doncaster

7.0

1114

Sunderland

6.9

334

South-East London

6.9

1088

Liverpool

6.9

1143

Manchester

6.8

1456

Lancaster (4.6) and Carlisle (4.1) were the only towns in the North West to have lower than the average number of repossessions.

But although the rate of repossessions remains far higher in the North, some of the best improving areas are to be found in the North West and in Yorkshire & Humber, suggesting the North South divide may be beginning to narrow. Carlisle in the North West saw repossessions fall 26% year-on-year, and Harrogate in Yorkshire & Humber saw a fall of 23% – both more than double the average.

Repossession Postcodes – Biggest Improvers

Postcode area

Repossessions/1,000 households in 2013

Repossessions/1,000 households in 2012

% change

East-Central London

1.0

1.8

-46%

Carlisle

3.0

4.1

-26%

Harrogate

2.3

2.9

-23%

Telford

5.2

6.7

-22%

Hull

4.9

6.2

-21%

England & Wales Average

4.7

5.2

-10%

London improving but more slowly than elsewhere

Repossessions are falling more slowly in London than in any other region of the UK. The repossessions rate in the capital fell 8% between 2012 and 2013, compared to 11% across England and Wales.

There were 4.7 repossessions per 1,000 households in the capital in 2013, slightly more than the average across England & Wales. London contained both some of the worst and some of the best areas for repossessions. In Greater London town Romford – the second worst area – there were 7.8 repossessions per 1,000 households in 2013, and in South-East London there were 6.9. But at the other end of the spectrum, the two areas with the least repossessions also fall within the capital: East Central London (where only 1.0 in every 1,000 homes was repossessed last year) and West London (2.2 homes in every 1,000).

Methodology

The research looks at the rate of repossessions per 1,000 mortgage-owned households in each postcode district across England and Wales. It does not include houses which are socially rented or owned outright. Figures for the number of mortgage-owned households per postcode district are derived from household numbers taken from the 2011 census. For the purposes of the North South divide, the study used a line from the Wash to the Bristol Channel.

Leave a Reply

Your email address will not be published. Required fields are marked *