Mortgage arrears fall for 12th consecutive quarter

The number of residential mortgages in arrears has declined for the 12th consecutive quarter, according to the latest figures from the Central Bank.

A total of 82,092, which corresponds to 11 per cent of all residential mortgages, were in arrears at the end of the second quarter of 2016, down 4.5 per cent on the previous three-month period.

At the end of June, there were 743,700 private residential mortgage accounts for principal dwellings in Ireland with a total value of €100.9 billion.

There were 57,571 owner-occupier mortgages in arrears for 90 days or more at the end of of June, equivalent to 8 per cent of residential accounts, 3.6 per cent down on the previous quarter, mark ing the 11th successive quarterly reduction.

The figures show the level of arrears in all categories of maturity, including over 720 days’ category, declined during the period.

The long-term arrears category, often viewed as the most problematic, recorded a fourth consecutive decline, having fallen for the first time in the third quarter of 2015.

Longer-term arrears

The Central Bank said accounts in arrears over 720 days, however, constituted 43 per cent of all accounts in arrears, and 87 per cent of arrears balances outstanding.

For the six main Irish lenders, the value of accounts in longer-term arrears of over 360 days remains large, amounting to €9.5 billion, the figures showed.

The figures also showed 120, 614 residential mortgage accounts were classified as restructured at the end of June.

Of these restructured accounts, 88 per cent were deemed to be meeting the terms of their current restructuring arrangement, the highest level since the series began.

The largest increases in restructures were again recorded in the categories of arrears capitalisation, whereby some or all of the outstanding arrears are added to the remaining principal balance, and permanent split mortgages with some sort of permanent debt writedown.

In the buy-to-let segment of the market, which encompasses 134,993 residential mortgage accounts with a value of €25.2 billion, arrears over 90 days decreased by 2.5 per cent during the second quarter.

At the end of June, there were 4,828 buy-to-let accounts in arrears over 720 days, with an outstanding balance of €4.4 billion, equivalent to 18 per cent of the total outstanding balance on all buy-to-let mortgage accounts.

There was, however, an increase of 1 per cent in the number of buy-to-let accounts where a rent receiver was appointed, following a decline of 5 per cent in the previous quarter.

During the second quarter rent receivers were appointed to 991 buy-to-let properties, bringing the stock of accounts with rent receivers appointed to 5,741.

There were 685 buy-to-let properties in the banks’ possession at the beginning of the quarter while a total of 305 properties were taken into possession by lenders during the quarter, which represented the highest volume of repossessions in a quarter since the series began in 2012.

Of the total buy-to-let repossessions in the quarter, 171 were repossessed on foot of a court order, while the remaining 134 were voluntarily surrendered or abandoned.