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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (30272)	4/28/2005 9:54:04 AM
From: Joe S Pack	Respond to of 306849

35% leap in court actions to repossess houses, in UK I am not sure how much it has to do with the election that consumate lier Blair is facing now.... Rupert Jones and Terry Macalister Thursday April 28, 2005 The Guardian money.guardian.co.uk The number of court actions to repossess houses has jumped more than 35% in the space of a year to reach the highest level since the end of the last property price crash, according to official figures released yesterday. The figures will be embarrassing for Labour, which has made the economy - and the Tories' record on the housing market - central to its election campaign, with posters highlighting how the early 1990s slump triggered a flood of repossessions. Yesterday's data provides evidence that the increase in borrowing costs has started to bite, and came on the same day that Britain's biggest estate agent issued a profits warning. According to the Department for Constitutional Affairs, the number of mortgage possession actions "entered" - the first step in the process for seizing a property, where a lender issues a summons in a county court - totalled 25,869 in the first three months of this year. That is more than 35% higher than the 19,155 actions entered in the same period last year, and 25% up on the last three months of 2004. The department said this was the highest quarterly figure since its records began in early 1995. A spokesman said it did not have figures for the period before 1995, which would take in the years immediately after the last house price crash. Actual orders made for repossessions reached 14,048 in the first three months of this year - up from 11,888 in the last quarter of 2004. The figures do not show how many houses are actually repossessed because not all orders are carried out. In many cases, a compromise will be negotiated or an order will be suspended. But they do provide evidence that five interest rate rises between November 2003 and August last year are starting to stretch some homeowners. Mark Allen, a partner at accountants Grant Thornton specialising in consumer spending, warned that the figures could be "a sign of things to come". He believes the figures are being driven by "excessive consumer spending". However, he said that the majority of actions do not translate into repossessions. Keith Stevens, an insolvency partner at accountants Wil-kins Kennedy, said: "As interest rates rise further and more discounted mortgages come to an end, we have to expect that more borrowers are going to find themselves under water. "These figures, along with poor trading results from retailers, show that the monetary policy committee's bitter medicine is finally working." More gloom was served up in the housing market yesterday with Britain's largest estate agent, Countrywide, issuing a profit warning and homes builder Wilson Bowden describing the market as "fickle". Countrywide argued that trading conditions in the first quarter of 2005 had picked up from a very weak position in the three months earlier but transaction levels were still 25%-30% below the same period last year. Shares in the company slumped 7% to 298p, making it the biggest loser in the FTSE 250 mid-cap stocks and adding to the disappointment that came last month when it reported a 42% fall in 2004 profits. "The market remains fragile and volatile and slowed in the second half of March," said Countrywide. UP ....