A new taskforce set up by the Housing Minister Nelson McCausland earlier this year to investigate the impact of negative equity, repayment arrears and possessions has identified Londonderry and Limavady amongst eight repossession ‘hotspots’ across Northern Ireland.
Established in early 2014 the ‘Repossessions Taskforce’ has now completed its research phase and published an initial evidence paper.
Amongst its findings are that back in 2012 the banks took more per capita possession cases against Londonderry and Limavady mortgage debtors in bids to seize homes than in most other parts of Northern Ireland.
In Londonderry’s case only Armagh and Banbridge had a higher per capita possession case rate. In Limavady’s case only in the aforementioned areas, as well as Newry and Mourne, were the banks more active in seizing homes.
The initial research report reveals: “Quantifying the actual level of regional possessions is particularly challenging. The Northern Ireland Courts Service publishes statistics for the number of possession cases received and disposed, and provides a breakdown of the final orders made (NISRA, 2014).
“While these figures are not a complete representation, they are informative as a proxy of people at risk of possession.”
The taskforce identifies Limavady, Londonderry, Omagh, Dunagannon, Armagh, Banbridge, Newry and Carrickfergus as ‘hotspots’ of possessions in 2012.
The report, however, goes on to point out that while particular areas may appear as ‘hotspots,’ the data across all regions illustrates that the margins between districts are not significant and the consideration of possessions and potential mitigating actions must be done at a regional level.
The taskforce blames the high house price to earnings ratio, relaxed credit conditions and peer pressure during the boom for the high number of borrowers here in negative equity.
Remarkably, 41 per cent of borrowers with mortgages advanced since 2005 are in negative equity or are ‘mortgage prisoners’ as the taskforce describes them.
This compares with 16 per cent in the North of England and one per cent in London.
Particularly affected, the report states, are: “Single people, couples with no children, borrowers with one or two bedroom properties, those who purchased after 2005, borrowers who remortgaged and those in intermediate or professional occupations.”
Minister McCausland said: “Although the housing market is showing signs of stabilising, the position of many borrowers, households and communities continues to be blighted by negative equity, repayment arrears and the risk of repossession.
“While this initial evidence paper is a solid platform from which the Taskforce can consider and develop potential mitigating actions, there are critical gaps in the data for Northern Ireland.”
The Housing Repossessions Taskforce’s initial research report can be viewed on the DSD website at http://www.dsdni.gov.uk/housing-repossessions-taskforce.htm.
The Minister continued: “I would encourage sector specific groups and indeed members of the public who have been affected by these issues to take the opportunity to help the Taskforce improve this evidence base as insight, perspectives and personal experience will be invaluable in finding innovative solutions to these complex and evolving issues.
“To play your part and contribute to this process you can complete a survey at https://www.surveymonkey.com/s/Repossessions-Taskforce or alternatively you can email your contributions to firstname.lastname@example.org.”
In conjunction with a review of the evidence base, the next stage of the Taskforce’s work will be the consideration and development of potential mitigating actions to be produced at the end of this year.
These will improve the existing provision of advice and support which are currently available for distressed borrowers.
A comprehensive range of services are currently in place to support households if they are worried about their situation. The Minister encouraged people to access advice and speak to their lenders as soon as possible.
The Minister concluded: “The earlier borrowers receive advice and engage with their lender, the more likely they are to arrive at an affordable and sustainable solution. I would urge anyone struggling to pay their mortgage or worried about the future to seek help as early as possible. The nidirect website as well as organisations such as Housing Rights Service, Debt Action NI and Citizens Advice can help households reach an affordable and sustainable solution.”
Information on debt management is available on the nidirect website at http://www.nidirect.gov.uk/debts-and-arrears.