Home repossessions to increase next year

CML report forecasts that mortgage arrears and repossessions will rise incrementally in 2011. A small rise in repossessions has been predicted by the CML. Home repossessions and mortgage arrears will rise slightly in 2011, according to predictions made by the Council of Mortgage Lenders (CML). Its annual forecast predicts that house prices will either fall slightly or remain at the current level with sales persisting at the level of today's property market. The CML also expects that banks will continue with their stringent mortgage eligibility policy preventing newcomers to the property sector from making their first purchase. Currently just 2% of all new mortgages on homes were secured with a deposit worth 10% or less of their purchase price, illustrating the tightening of banking regulations and the difficulty faced by potential buyers armed with low level lump sums.