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21-12-2009

Mortgagee sales to stay high for another 12-months

Landlords.co.nz

Mortgagee sales are at historically high levels and numbers are expected to remain high in the New Year.

By Jenha White

Terralink managing director Mike Donald says while October's figures were down from September's historical high of 343 he expects the numbers to remain high for awhile yet.

Terralink International's data shows there were 298 registered mortgagee sales in October compared to 174 the same time last year.

Donald says pre-recession there were about 190 mortgagee sales for the whole year and now we're seeing those levels every month.

"It's a mistake to think that a decrease in October means that mortgagee sales are set to return to pre-recession levels, the numbers remain at an all time high.

"It's still a volatile situation and the numbers of mortgagee sales we have been seeing shows the length of time it takes to work through the financial stress of the recession."

Donald believes we will start to see a recovery with mortgagee sales in the last quarter of 2010 because unemployment and business needs to pick up first.

He says one in four of the total mortgagee sales is from mum and dad homeowners with one property.

"As the year has gone on, and spending has decreased, and redundancies have increased, more and more ordinary New Zealanders have been affected by the recession.

"Forced sales of their homes has unfortunately been a consequence for some," Donald says.

Terralink found that the regions hardest hit in October were Waikato with 39 mortgagee sales, up 22% on the previous month and Auckland with 117 mortgagee sales, up 3% on the month before.

Otago, Southland and Taranaki all experienced increases in mortgagee sales as well.

Mortgagee sales accounted for almost 5% of the total nationwide property sales in October.

Source: Landlords.co.nz

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