British home repossessions highest in 15 years

British home repossessions highest in 15 years


Home repossessions in England and Wales rose to their highest first-quarter levels in 15 years, the government said Friday.

It was the highest repossession rate since 1993, and was up 9 percent compared with the previous quarter.

Howard Archer, chief European economist at Global Insight, said the report underlined the limited impact for consumers of a series of interest rate cuts this year. The Bank of England has lowered the rate from 5.75 percent to 5 percent.

"The overall beneficial impact is still being significantly diluted by a number of mortgage and borrowing rates being pushed up by the lack of liquidity and elevated market interest rates," Archer said.

In a series of reports earlier this month, Britain's biggest mortgage lender said the average house price fell 4 percent in 2008; the government said individual insolvencies in England and Wales rose 1.7 percent in the first quarter compared to the previous quarter; and an industry group said construction activity had slumped to the lowest level in nearly a decade.

"Rising utility bills and elevated food prices are weighing down particularly heavily on the most financially strapped people, adding to their difficulties in meeting their mortgage payments," Archer said.

BUSINESS WEEK