Mortgage Lending in UK to Fall, Arrears to Rise in 2024

Higher interest rates and living costs predicted to lead to an 8% decrease in lending and an increase in arrears and repossessions, with a potential turnaround expected in 2025.

• UK Finance predicts an 8% fall in UK mortgage lending in 2024 due to higher interest rates and household costs, with lending for house purchases expected to decrease from £130bn in 2023 to £120bn in 2024.
• Mortgage arrears are forecast to rise from 105,600 cases by the end of 2023 to 128,800 by the end of 2024, marking the highest level in eight years.
• Repossessions are expected to increase from 4,400 in 2023 to 5,100 in 2024, the highest point since 2019.
• The value of buy-to-let loans on new purchases in 2023 is expected to be 53% lower than in 2022, with a further 13% fall predicted for 2024.
• Despite the challenging outlook, UK Finance anticipates a turnaround in 2025 as pressures on household finances begin to ease.

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