More repossession forecast in the UK

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A new study has estimated that more people will struggle to pay their mortgages in the coming year, suggesting that a greater number of consumers might look to rent property.

According to the Council of Mortgage Lenders (CML), the number of people with more than three months arrears on their mortgage will increase from 145,000 in 2007 to 170,000 by the end of 2008.

What's more, the total number of repossessions in the country will jump from 30,000 in 2007 to 45,000 over the same period.

These figures could indicate that landlords will see further increases in demand for rental properties.

"The housing and mortgage markets are facing their most challenging period since Labour came to power a decade ago," explained CML director general Michael Coogan.

"We now expect a slower mortgage market next year, although by no means a stagnant one. Most borrowers will cope,but not everyone will escape unharmed from the effects of a slower market."

Recently, Arla reported that more than half of its members plan to increase the size of their portfolio in the coming year to cope with expected increases in demand.

"Private buy-to-let investors have refinanced the private rented sector and restored social acceptability to renting," explained Ian Potter, Arla's operations manager.

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