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There was a lot of movement in the UK mortgage market in Q4 2024, and if you’re looking to buy a repossessed property, these shifts are worth paying attention to.
Here’s a breakdown of the latest updates:
The total amount owed on UK residential mortgages has hit a record high of £1.68 trillion. That’s a 0.5% increase from the previous quarter and 1.3% higher than this time last year.
Lenders issued £68.8 billion in new mortgages in the last quarter – the most since the end of 2022. This figure is also almost 30% higher than a year ago, showing strong activity in the lending market.
Mortgage commitments (loans that are approved but not yet paid out) rose to £69.3 billion – the highest since late 2022. That’s over 50% higher than the same period last year.
More borrowers are taking on higher levels of debt relative to their income. Almost half (45.8%) of new mortgages were considered high loan-to-income ratios – a sign that people are stretching further to get on the property ladder.
First-time buyers now make up 29.6% of all new mortgages. That’s the highest share since records began in 2007.
The proportion of mortgages for people buying a home to live in dropped slightly to 63.7%, although it’s still almost 4% higher than a year ago.
Remortgages for owner-occupiers increased a little to 23.5%, although this is still down compared to a year earlier.
New arrears cases rose to 12% of all accounts already in arrears. The total value of mortgage debt in arrears climbed to £22.1 billion – up 1.3% from the last quarter and 8.4% higher than a year ago.
With more borrowers struggling to meet repayments, and riskier lending on the rise, there’s a strong chance we’ll see more repossessed properties on the market in the near future.
As financial pressure increases, especially among those who stretched their borrowing limits, we may see more distressed sales. That could lead to a greater number of repossessed properties on the market.
With increased lending and a surge in first-time buyer activity, competition is likely to rise. If you’re in the market for a repossessed property, being prepared to move quickly is essential.
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We will continue to report on the latest data so remember to keep an eye on the trends, stay financially ready, and you could find some great opportunities in the months ahead.
This is our summary of FCA’s March 2025 commentary – for full information, please visit The FCA’s Website
