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Houses being repossed question

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  • 22-12-2009 7:56pm
    #1
    Rafa1977
    Closed Accounts Posts: 400 ✭✭


    Just a question regarding all these houses that are being repossed. What exactly happens to them, are they sold at a reduced price to get somebody into them or do they maybe go through Auction.


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    #2
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Rafa1977 wrote: »
    Just a question regarding all these houses that are being repossed. What exactly happens to them, are they sold at a reduced price to get somebody into them or do they maybe go through Auction.

    It really depends on who is repossessing them. Some of the subprime lenders have been very fast to repossess (Start Mortgages often have more applications up before the courts than all other lenders combined- for example). There is very little appetite for residential property auctions these days- other than for prestigious properties/addresses. In all liklihood- the properties would be handed to one of the larger estate agents with instructions to dispose of them within a set timeframe for whatever the market will bare.

    Something to think about- there have been fewer than 1000 repossessions in 2009- yet there are over 26,000 residential properties greater than 6 months in arrears (this represents a loan book value for the lending institutions of about 4.8 billion- and is almost 3.6% of all properties). We have a bumpy ride ahead of us.......


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    #3
    the iceman come
    Closed Accounts Posts: 96 ✭✭the iceman come


    smccarrick wrote: »
    It really depends on who is repossessing them. Some of the subprime lenders have been very fast to repossess (Start Mortgages often have more applications up before the courts than all other lenders combined- for example). There is very little appetite for residential property auctions these days- other than for prestigious properties/addresses. In all liklihood- the properties would be handed to one of the larger estate agents with instructions to dispose of them within a set timeframe for whatever the market will bare.

    Something to think about- there have been fewer than 1000 repossessions in 2009- yet there are over 26,000 residential properties greater than 6 months in arrears (this represents a loan book value for the lending institutions of about 4.8 billion- and is almost 3.6% of all properties). We have a bumpy ride ahead of us.......



    Yes indeed,

    The term "tip of the iceberg" springs to mind.


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    #4
    StanByrneGalway
    Closed Accounts Posts: 18 ✭StanByrneGalway


    I had my home repossed in the last recession and the bank sold it really cheaply. anyone with cash is going to be in a strong position to pick up great value property in around six months when this really starts to kick in.


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    #5
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    StanByrneGalway wrote: »
    I had my home repossed in the last recession and the bank sold it really cheaply. anyone with cash is going to be in a strong position to pick up great value property in around six months when this really starts to kick in.

    People don't have the money though- and despite the claptrap the banks are coming out with- they are not lending. If you want to buy a property- the only way is to save up a sizeable deposit (the larger the percentage the more likely you are to secure a mortgage- but 25-30% sounds good.)

    Sorry to hear you lost your home last time around- I hope you're more secure now than you were then. There are going to be a massive number of repossessions over the next 2-3 years in Ireland- unless the banks and lending institutions are nationalised, and the government turn the brief moratorium into a longer term stay on repossessions. There are already 18,000 of the 26,000 over 6 months in arrears, that can have the button pushed on the paperwork with a single click of a computer- and things have not gotten bad yet.


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    #6
    dny123456
    Closed Accounts Posts: 431 ✭✭dny123456


    There will not be widespread repos in my opinion as it would not serve anyone's interest (apart from cash buyers, of which there would be very few). It doesn't suit the financial institutions as it would devalue the remainder of their loan books. It's not in the government's interest as it would increase their exposure to unbacked loans. They will do anything and everything they can to avoid kicking people out of their homes and will prop it up everyway they can. That's probably not what most people on boards would want to hear, thinking they'll get a 'bargain' now that the housing bubble has burst. There'll be a lot of disappointed people as they discover they either don't have jobs to secure loans, have reduced pay/increased taxes and consequentially can't get mortgage approval.


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    #7
    inforfun
    Moderators, Social & Fun Moderators Posts: 20,862 Mod ✭✭✭✭inforfun


    dny123456 wrote: »
    There will not be widespread repos in my opinion as it would not serve anyone's interest (apart from cash buyers, of which there would be very few). It doesn't suit the financial institutions

    Saw/heared a similar statement yesterday in the news. Certain arrea of the country they had repossesd 100 properties this year but they were still stuck with 78 of them.
    Cant remember where it was ...


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    #8
    Jaysoose
    Closed Accounts Posts: 3,212 ✭✭✭Jaysoose


    But your relying on the banks or the goverment being able to:

    1. do basic maths
    2. See the bigger picture
    3. Not drop the ball for the millionth time on this whole area.

    We are screwed people.


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    #9
    StanByrneGalway
    Closed Accounts Posts: 18 ✭StanByrneGalway


    so true! and another issue is negative equity and how the banks treat this. a friend of mine bought a house in Brighton in 1997 after the house had been in negative equity for 10 YEARS and the owner was only "allowed" sell it at that point. So he lived in it for ten years, had to pay the mortgage and then just recovered what he had paid. we have no idea in this country and our banks are the worst of all because there is so little competition.
    Jaysoose wrote: »
    But your relying on the banks or the goverment being able to:

    1. do basic maths
    2. See the bigger picture
    3. Not drop the ball for the millionth time on this whole area.

    We are screwed people.


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    #10
    Jo King
    Banned (with Prison Access) Posts: 2,139 ✭✭✭Jo King


    dny123456 wrote: »
    There will not be widespread repos in my opinion as it would not serve anyone's interest (apart from cash buyers, of which there would be very few). It doesn't suit the financial institutions as it would devalue the remainder of their loan books. It's not in the government's interest as it would increase their exposure to unbacked loans. They will do anything and everything they can to avoid kicking people out of their homes and will prop it up everyway they can. That's probably not what most people on boards would want to hear, thinking they'll get a 'bargain' now that the housing bubble has burst. There'll be a lot of disappointed people as they discover they either don't have jobs to secure loans, have reduced pay/increased taxes and consequentially can't get mortgage approval.

    Devaluing the loan book is not going to be that big of a concern. The banks held off on foreclosing on developers so as not to devalue their loan books and look where it got them. Cashflow is king. If a mortgage is in arrears the only way to get in some cash is to repossess and sell it. The threat of repossession is what makes many people do their utmost to pay their mortgage. If the banks do not foreclose on non performing loans they will have no cash to lend out to new applicants for mortgages. What is that going to do? Devalue the loan book! The lesser evil is to repossess and be dammed. IN the last recession repossessed houses were sold cheaply, mainly to friends of the branch managers of the building societies. The banks had very few residential mortgages at that time, which were invariably high grade.


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