UK repossessions rise

The Council of Mortgage Lenders (CML) has revealed in its latest overview of mortgage arrears and repossessions for the third quarter of the year, that the worsening profile of the buy-to-let market has caused the market, as a whole, to deteriorate faster and deeper than predicted.

Historically the payment profile of buy-to-let mortgages has been higher than that of the rest of the market. However, with rents falling and repayments of mortgages still not been translating directly from interest rate cuts, it seems as though many landlords are feeling the pinch.

There is an over-supply of rental property especially in the areas that have been hit by heavy job cuts.

Lenders have repossessed 11,300 homes in the third quarter, compared with 10,100 in the second quarter, according to the CML.

By the end of September the number of landlords that were struggling was up, as 1.58 percent of buy-to-let mortgages were at least three months in arrears.

Conditions are expected to worsen as the wider economy suggests a more difficult picture to come, as selling up is also a difficult exit option.

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