BTL Repossessions Rocket By 40%

BTL Repossessions Rocket By 40%
There has been an astonishing 40% rise in the number of buy to let repossessions, official figures reveal.
According to the trade body UK Finance, the number of properties owned by private landlords that were repossessed in the third quarter of this year are 40% higher than they were in the same period in 2018.
The figures highlight that 800 BTL mortgaged properties were repossessed, up from 570 in the third quarter of 2018.
The rise includes those landlords who have lost their property after a backlog of older cases were processed by lenders to meet the latest regulatory requirements.
That's when regulators changed rules on how a lender calculates how much a borrower is owing if they fall into arrears. This rule change led to a large number of cases being reviewed by the industry.
4,550 BTL mortgages in arrears currently
The figures also reveal that there are 4,550 BTL mortgages in arrears currently with numbers rising 5% year-on-year.
The Residential Landlords Association's policy director, David Smith, said: "There are many different reasons for repossessions for mortgage arrears."
He explained that mortgage interest relief changes have now been nearly fully implemented, plus the growing cost of regulation and the length of time it takes repossess a property have all been factors in the rising figure.
Mr Smith also points out the repossession of a buy to let property usually leads to the eviction of tenants and he urged the next government to support landlords in providing rental homes that the country needs.
Best areas for landlords around the M25
Meanwhile, the best areas for landlords to invest in around the M25 London orbital motorway have been revealed.
The lettings platform Howsy analysed renting costs around the M25 to find the best areas based on rental yields and affordability.
They found that the average rent along the southern stretches are higher than for the northern parts at £1,524 per month on average, compared with tenants along the northern stretches paying £1,352.
Essentially, tenants should head for Watford, Slough, Epping and Enfield as these are more affordable M25 rental areas.
While landlords should look to invest in Leatherhead, Sevenoaks and Reigate for their buy to let opportunities with investments along the southern junctions returning 4.01% on average every year, compared to the northern 3.61% figure.
The chief executive of Howsy, Calum Brannan, said: "For a property investment, key factors such as having easy transport links help ensure tenant demand and help to justify the property's rental price which maintains a healthy rental yield for the property."