Mortgage arrears were also at their lowest levels since the early 1980s, and fell on all measures.
The total number of repossessions in 2003 was 7,630. Of these, 3,490 occurred in the second half of the year. The number of repossessions in 2003 represented just one in 1,500 mortgages in the UK.
The total number of mortgages 6-12 months in arrears at the end of 2003 was 29,060 (0.25% of all mortgages). This compared with 34,030 (0.30%) at the end of 2002. Mortgages in arrears of more than 12 months totalled 12,850 at the end of 2003 (0.11%), compared with 16,480 at the end of 2002 (0.15%).
But the CML warns that such low figures are unlikely to last. Although arrears and possessions are expected to remain at relatively modest levels, the CML forecasts that they will rise modestly to 8,500 this year and to 11,000 next year. This would return repossessions to 2002 levels, similar to those of the mid-1980s, but still only a fraction of the totals seen in the early 1990s. The CML's "Repossession Risk Review", also published today, sets out the thinking behind the forecasts and highlights the various factors that could influence arrears and possessions going forward.
Commenting on the figures, CML Director General Michael Coogan said:
"With such low levels of default, both lenders and borrowers need to make a conscious effort to think about risk. The current benign economy may not last forever. Although most people should be able to weather the anticipated rise in interest rates without too much difficulty, there will be a small number who will struggle, especially those with large unsecured debts and little equity in their property. Now is definitely the time for people to be preparing themselves to absorb higher mortgage costs later this year."
