UK Home Repossessions: Highest since 1999

The latest data figures released by the CML or council of Mortgage lenders indicate a disturbing sign in the UK real estate markets. Look at the graph below (source BBC), which indicates the no. of homes repossessed by the mortgage lender or mortgage company because the borrower was unable to repay the loans.



The graph clearly indicates that there has been a consistent rise in the repossessions since 2003 and it is at its highest levels now. Not only that, the current set of mortgage borrowers, a significant number of them are reported to be repaying their mortgages using Credit Cards – which means taking one credit to return a previous one.

The mortgage lenders are directing the issue to higher cost of living, higher amount of bills that people have to pay and high cost of food as well. No wonder why living in a city like London requires a fortune – simple things like moving around in a car in central London forces you to pay heavy congestion charges. The recently released US consumer spending data appears no good either.

Anyways, the data is no way a good indicator of the economy. If this is the state of a so called developed country, how about the so-called emerging economies like India & China?

Banks in India are learnt to throw away loans to anyone and everyone. Then to “recover” the loans, they need to hire “recovery agents”. Things with such data are definitely no good. Emerging economies are still highly dependent on exports to the developed countries.

China for electronics, etc and India for manufacturing & software exports. If the developed economies face such a situation where they find their consumers spending less and less, it is but obvious that the emerging economies will suffer. The picture emerging on the global front is definitely not that of convenience, where one can simply play around with his investments. It may take a long time before this depressing situation gets away with and the economy returns to normalcy.

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