The number of homeowners seeing their properties repossessed has surged by more than half over the past year, according to new official data from the banking industry.
Sharp Rise in Repossession Figures
Figures released by UK Finance reveal that 1,390 homeowner mortgaged properties were repossessed in the third quarter of 2025. This marks a substantial 51% annual increase compared to the same period in 2024, and a 4% rise on the previous quarter.
The buy-to-let sector also experienced a significant uptick, with 900 landlord mortgaged properties being repossessed in the same period. This represents a 29% increase year-on-year and a 14% rise from the second quarter of 2025.
Despite these sharp increases, UK Finance was quick to provide context, stating that current repossession levels remain significantly below long-term averages. The industry body confirmed that present figures are broadly consistent with the five-year period immediately preceding the coronavirus pandemic.
Mortgage Arrears Show Encouraging Decline
In a contrasting and more positive trend, the data shows a notable decrease in mortgage arrears across both homeowner and buy-to-let portfolios.
For homeowners, there were 84,100 mortgages in arrears of 2.5% or more of the outstanding balance during the third quarter. This figure represents a 10% annual reduction and a 4% fall from the previous quarter.
The buy-to-let market showed an even stronger improvement, with the number of mortgages in arrers falling to 10,420. This constitutes an annual decrease of 20% and an 8% quarterly drop.
Industry Response and Borrower Support
Charles Roe, Director of Mortgages at UK Finance, described the falls in mortgage arrears as a "positive sign". He emphasised that the repossessions primarily affect "mortgages arranged more than 10 years ago" and remain low by historical standards.
"Lenders remain committed to supporting customers who may be struggling," Mr Roe stated. "If you are worried about your mortgage payments, please contact your lender as soon as possible to discuss the tailored help available."
This support comes amid a shifting interest rate environment, with several lenders recently reducing their fixed-rate mortgage offerings in anticipation of a potential further Bank of England base rate cut.
Mary-Lou Press, President of NAEA Propertymark, welcomed the arrears data as evidence that "stability is returning to the housing market after a challenging period for many borrowers."
She noted that "arrears remain well below long-term averages, reflecting the effectiveness of lender support and the resilience of households." However, she cautioned that the rise in repossessions "highlights that pressures still exist, particularly for those on older mortgage products."
Both industry experts strongly advised anyone experiencing financial difficulty to contact their lender promptly or seek independent, qualified advice at the earliest opportunity.
