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Repossessions Rising As Investors Decline Offer Of Homes Sold At Auction

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http://icwales.icnetwork.co.uk/news/featur...91466-20625557/

Repossessions rising as investors decline offer of homes sold at auction

Mar 15 2008 by Our Correspondent, Western Mail

Trouble ahead as homeowners face a tough credit environment and reduced mortgage competition
THE number of investors in Wales buying at auction has fallen, with blame attributed to tighter lending conditions and greater uncertainty over the outlook for house prices.
At the end of last year, just 47 per cent of properties fell under the auctioneer’s hammer in Wales compared to 64 per cent in the same period a year ago, according to the Royal Institution for Chartered Surveyors’ residential auction figures.
It was a similar picture across the UK where only 57 per cent of properties fell under the auctioneer’s hammer compared to 69 per cent in the same period in 2006.
The number of properties offered at auction was still close to historically high levels, with 7,732 properties placed under the hammer.
The overall number of residential properties offered at auctions rose by 15 per cent in 2007 while the number of
repossessed properties rose by around 20 per cent
, indicating that many have struggled to service their mortgages following last year’s interest rate hikes and tougher refinancing conditions.
This trend looks set to continue as the number of repossessions could increase by a further 50 per cent in 2008
.
Homeowners coming out of fixed rate mortgages will face a tighter credit environment, reduced mortgage competition and tougher refinancing conditions as banks and building societies continue to raise interest rates to recoup battered profit margins.
Cathy McLean, director of RICS Wales, said, “Fears over further house price falls have taken some stimulus out of achieved sales at the auction house as specialist lending has all but evaporated.
“While lots offered at auction have stabilised, we expect a tougher year for many at the margins in 2008 as mortgage providers become more selective.
“While tightening credit conditions will be most acute for those with a poorer credit history, less generous loan amounts and the introduction of some upper limits on loan advances could equally hit the mid-tier of the market, increasing the number of properties languishing on auction property books.”

Looks like we shall soon be where the US market is now. Lag seems to be shortening somewhat as the crash progresses.

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The overall number of residential properties offered at auctions rose by 15 per cent in 2007 while the number of repossessed properties rose by around 20 per cent, indicating that many have struggled to service their mortgages following last year’s interest rate hikes and tougher refinancing conditions.

Why the discrepancy? whats happening to the other properties. Demolished? :lol:

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Why the discrepancy? whats happening to the other properties. Demolished? :lol:

I think the banks sometimes sell through an EA.

Could be wrong though, and not sure how they make the choice.

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Shows it is time for vendors to start getting real and stop pricing at pre-cruch levels.If only 57% of properties are selling at fire sale rates at auction what chance have the greedy b****ds got of selling at optimistic asking prices the conventional route.Truth is they haven't got a cat in hells chance of selling,inventories are rising and property is sitting unsold for YEARS in my area.

Edited by crashmonitor

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Guest happy?
....

The overall number of residential properties offered at auctions rose by 15 per cent in 2007 while the number of repossessed properties rose by around 20 per cent, indicating that many have struggled to service their mortgages following last year’s interest rate hikes and tougher refinancing conditions....

Why the discrepancy? whats happening to the other properties. Demolished?

Two things are happening:

There are many more repossessed properties coming onto the market - hence there are more of them as a %

As auction houses get swamped with repo properties their reputation for being a good place to sell at high prices diminishes - in other words sales volume increases but the cost is decline in quality.

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  • 293 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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