All UK regions repossessions set to rise with a modest increases in both the rate and number of repossessions, although Northern Ireland will experience a repossession rate more than four times higher than the South West of England, the data shows.
Damian Riley, HML director of business intelligence, said: “The increase in property repossessions during 2012 will be the legacy of high levels of mortgage arrears in 2011 (there is still a stock of 27,300 loans with arrears of more than 10% of their outstanding balance).
“Although interest rates continue at historically low levels and look set to remain that way during 2012, the worsening economic situation will inevitably put pressure on household incomes.
“Some lenders may also choose to apply forbearance only when it is deemed fully appropriate to do so and a tougher approach may cause repossession rates to rise further. However, there is no evidence that this has yet started to happen.
“Uncertainty over economic problems in the eurozone and the knock-on effect they may have in the UK, make forecasting particularly difficult at the moment. However, HML believes that although we will see repossessions peak in 2012, they should, barring any unforeseen sovereign debt, interest rate or other shock, then start to fall back during 2013.”
HML manages around £43bn of mortgages on behalf of 50 leading financial institutions. It forecast in January this year that a total of 33,257 homes would be repossessed throughout 2011 and that would rise to between 35,000 and 40,000 during 2012.
The Council of Mortgage Lenders (CML) recently confirmed that during the first three quarters of 2011 a total of 27,500 properties were taken into possession and said total figures for 2011 would be below its original forecast for the year of 40,000.