New research has produced a unique insight into the characteristics and circumstances of people faced with their homes being repossessed. The research is likely to make a major contribution to the prediction and prevention of repossessions in the future.

The research, undertaken by the Chartered Institute of Housing’s consultancy arm – ConsultCIH – looked at hundreds of repossession orders made in 2008 in the South West of England. The findings have identified valuable patterns of information around factors such as demographics, causes, lenders, court activity, advice services and support schemes.

The research identified some clear financial similarities and patterns of household behaviour, which are particularly valuable to identify those at risk of repossession. These include:

- Most borrowers are faced with repossession within four years of taking the mortgage out;

- Established homeowners who have re-mortgaged to access equity in the past five years – as opposed to first time buyers – are more likely to face re-possession;

- Almost all households facing repossession pay higher than average or unusually high rates of interest;

- Evidence suggests that most people getting into financial difficulty have borrowed right up to their limit;

- Households generally stop paying their mortgage altogether, rather than reducing or deferring payments;

- Repossession orders are dominated by banks that have received government assistance, specialist and non-prime lenders;

- The interest rates on loans subject to repossession have generally increased between start of arrears and court hearings; and

- Arrears of five months or more are likely to make it difficult to avoid repossession.

Richard Medley, Director of ConsultCIH, said: "Our research suggests that it is now possible to predict when and where future rises in the number of home owner repossessions are most likely to occur.

"Whilst it is not possible to get much advance warning of a rise in repossessions – often between just four and eight months - organisations and agencies will now be in a much stronger position to take preventative action and target those households who fit the profile of those most at risk."

*ENDS*

News release issued on behalf of the CIH by Jill Dwyer, CIH Press Office, Octavia House, Westwood Way, Coventry CV4 8JP. Telephone: 02476 851780 or 07786 716961. Email: press@cih.org.

Notes to Editors:

1. ConsultCIH Limited is a wholly-owned company of the Chartered Institute of Housing providing consultancy services to organisations in the housing and regeneration sectors. ConsultCIH has a large team of qualified professionals with over 25 years experience of providing high quality consultancy services throughout the UK. Further information is available at: www.consultcih.co.uk 

2. The Chartered Institute of Housing (CIH) is the professional body for people involved in housing and communities. We are a registered charity and not-for-profit organisation. We have a diverse and growing membership of over 22,000 – both in the public and private sectors – living and working in over 20 countries on five continents across the world. Our members work for local authorities, housing associations, Arms Length Management Organisations, Government bodies, educational establishments and the private sector. Many tenants and residents are also members. We exist to maximise the contribution that housing professionals make to the wellbeing of communities. Further information is available at: www.cih.org 

3. The research was undertaken on behalf of Government Office for the South West and South West Councils. A summary of the findings can be found at: http://www.consultcih.co.uk/documents/summary-repossession-nov09.pdf. The full report is available from: http://www.consultcih.co.uk/documents/final-repossession-nov09.pdf