A close in the regional north-south divide in the number of repossessions has been indicated, according to a new survey from e.surv.
The report suggests that the gap between repossessions in the North and South of England and Wales has dipped by around 20%.
Data from the report indicates that the North of England saw 4.1 possessions per 1,000 households during 2014. The South however saw only 2.9. In comparison to 2013, repossessions stood at 5.4 for the North and 3.9 for the South, meaning that the regional gap has closed by 19% year-on-year.
Encouragingly, the number of home repossessions as a whole have fallen across England and Wales. Figures show that there were 39,938 repossession orders across the two nations in 2014, which was a significant fall of 25% from the 53,325 recorded in 2013. This means that there are currently 3.5 repossession orders per 1,000 households in England and Wales, which is down from 4.7 in 2013.
Towns in the North of England enjoyed a much better year in terms of the number of repossessions recorded. During 2014, 44% of Northern towns had an average repossession rate. However, this was a marked improvement on the 78% recorded in 2013.
Richard Sexton, director of e.surv, feels that the gap between North and South repossessions is closing. Sexton said that, ‘northern towns are less prominent as repossessions hotspots. Brits are feeling the benefits of falling fuel and food prices, which have filtered through into low inflation and even deflation in the first part of 2015. All the while, wages are increasing, meaning there is more money to go around.’ He believes that, ‘this has given financially fragile homeowners the chance to bolster their credit and retreat from the repossession threat. The economic environment has helped greater numbers in the North as there were more borrowers on the edge in this area.’
Mr Sexton went on to say that, ‘the Government’s plans to devolve power to the regions could help eradicate the remaining rift-with more opportunity for long-term local investment. This will allow for targeted spending to create jobs in areas that need them the most-which may dramatically relieve repossessions.’
Repossession rates fall nationally during last year
Despite these substantial improvements, repossession rates in the North-West of England were still the highest recorded in 2014, with 4.6 repossessions recorded per 1,000 homes. Furthermore, 86% of towns in the region had repossession rates above the average England and Wales rate of 3.5.
Moreover, the North East of England was tied with Wales as the least improved region, with repossessions falling by 23% between 2013 and 2014. Bradford was found to have the highest rate of repossessions per city, with 6.2 repossessions recorded per 1,000 households. This was closely followed by Oldham with 6.1 and Sunderland with 5.8.
Sexton commented that, ‘budget cuts in the wake of the crash led to a swathe of job losses from which the North is only just starting to recover. In the North West particularly, there is a greater rate of home repossessions than any other region.’ He argues however that, ‘the picture isn’t entirely bleak. Every region is clearly performing better than last year, pushing down repossession rates as the country gets its finances under control. We need to use the example of the North West as a useful reference.’
He went on to argue that, ‘George Osborne’s mooted plans to devolve more power to Northern cities could make or break this burgeoning recovery. If the trial run in Manchester takes off, it could pave the way for local authorities to take greater ownership of their local infrastructure.’ Sexton believes that, ‘this could allow them to tailor their futures to meet their demands. The North East and North West may be struggling-but the challenges they face may not respond to solutions that work for the rapidly improving East of England.