Mortgagee sales increase in Auckland and Northland
Monday 5 July 2010
The number of homes going up for mortgagee sales isn't decreasing, however type of property going to sale is.
By The Landlord
Terralink says there were 246 registered mortgagee sales in April, which is comparable to 250 for the same month a year ago. There is also a slight increase in mortgagee sales from the previous month, when 202 were recorded.
In April, Auckland City and Northland recorded the largest leaps in mortgagee sales. In Auckland there were 95 mortgagee sales, up from 58 the month before, and Northland climbed from 16 to 25. Most other regions remained steady compared to the previous month.
Terralink managing director Mike Donald says despite talk of an economic recovery, the number of forced property sales remain at levels previously unseen.
"We've been tracking mortgagee sales since 1994 and last year the numbers rose dramatically. A year on, and the 2010 data is looking eerily similar to the 2009 trends."
"While some say the economy is starting to show small signs of recovery, the banks have tightened their credit policies, the retail market remains slow, and interest rates are climbing. All these factors add up, and result in a strain on many property owners.
"September 2009 saw the highest number of mortgagee sales we've ever recorded at 343. I'd be surprised if we saw anything at that level this year, but it's likely they will remain high. We have a way to go until we see a return to pre-recession numbers."
Donald says while the trends year on year are similar in numbers, the types of properties and lenders involved in forced sales have changed.
"Initially it was over-stretched property developers and investors with multiple properties that made up the majority of mortgagee sales, and it was mainly second tier lenders who were forcing them. Now, larger numbers of mortgagee sales are affecting property owners with only one property and the majority of lenders that are forcing them are now the larger trading banks," he says.
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