Home repossessions have continued to fall, according to latest figures. The Council of Mortgage Lenders (CML) reports that the number of homes taken into possession fell by 4.1% in the second three months of this year – the third quarterly fall in a row. The decrease has caused the CML to cut its forecast for repossessions in 2010 from 53,000 to 39,000.

The body also noted a fall in the numbers of those in significant mortgage arrears.

The better-than-expected picture is being put down to a combination of factors, including interest rates at historic lows, the constructive approach of some lenders, and the package of government measures designed to help those in difficulties.

However, CML director Michael Coogan cautioned against complacency. Along with debt charities, he warned that cutbacks and the withdrawal of government schemes could undermine the positive trend. Stalling economic growth and job losses might also have a negative impact on the figures.

Meanwhile, prospects for continued low interest rates have received a boost. The quarterly inflation report from the Bank of England suggests that (thanks in part to sluggish growth) inflation will be below its 2% target in two years’ time – even if the Bank’s base rate stays at its current 0.5%.

Tags: Economy, Housing Market

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