The Numbers for Mortgage Repos US vs UK vs SA

The United States of America,  has clearly had massive mortgage problems in recently years and its repossession rate is considered to be a problem case in comparison with, for example, the United Kingdom in the academic literature.[1] As we will see however, South Africa, in a normal year will sell a far higher percentage of its mortgage book than the United States, and a comparable amount  to its levels even at the height of its historic crisis. The peak US figures however are more than 1 million foreclosures  in 2010 (1.24% of all mortgages) and 2.9 million foreclosure filings[2] which is 3.6% of all mortgages. [3]  Actual foreclosures, however, were around 463,000[4] in 2013[5] or 0.58% of all mortgages.


Thus, with about 2% of all mortgages receiving sale in execution notices in South Africa during recessions the SA figure approaches the figure for the US in one of the worst mortgage crises that the world has ever seen. (Not all filings[6] lead to an actual foreclosure/repossession, in the US at this point, the rate would be 37% leading to an actual sale.)[7].


Thus, the SA average is close to half the figure for the US at its worst.


UK in the recent financial crisis peaked in 2009, where 48,900 homes seized over the course of that year[8] and the figures for 2008[9] were similar.[10] This compares with around half these levels during the boom times of 2007

The repossession rate per year in the UK, in the crisis was thus at 48,900 per annum would be only 0.43% of the total number of mortgages.[11] This would thus be the high figure for comparison with the SA long term rate of 0.22%. By comparison, by the second quarter of 2013, the repossession rate in the UK had already dropped to about 0.27%[12] of mortgages being repossessed.[13]


Looking at the average values, rather than highs and lows, the average in the UK appears to be about 16,000 repossessions per annum over the decade to 2011,[14] including peaks and troughs, equating to 0.146% of the total number of mortgages. The comparable South African average over the same decade would be about 0.22%, or about twice.


Similarly, Ireland, badly hit by the financial crisis, put a moratorium on repossessions for many years. Yet, even after a 500% increase in repossessions after a moratorium ended, it is only repossessing about 2000 properties a year.[15]


[1] The theme of Krebs’s paper: Nicholas Krebs “British Cures for American Foreclosure Woes: A Comparative Analysis of Foreclosure Law in the United States and United Kingdom” Chi.-Kent J. Int’l & Comp. L. Vol. XV p3; Herzog, Thomas “American Society of Actuaries, History of Mortgage Finance with an Emphasis on Mortgage Insurance” (2009).


[3] There are around 80.6 million mortgages in the United States. .  “As of October 2013, there were 1,252,416 properties[3] at some stage of foreclosure in the United States”, which is 1.5% of all mortgages.

[4] This is about 37% of all filings, a higher percentage that the UK figures of 15% and 20% examined earlier.


[6] These are roughly equivalent to what is called a notice in South Africa

[7] 463,000 divided by 1.2 million.  The historical rates 2006 to 2014 appears to be around 25%.

[8] There are 11.3 million mortgages outstanding in the UK, with loans worth over £1.2 trillion

[9] In June 2008, there were about 54,000 new mortgage arrears cases per quarter and 312,000 loan accounts in arrears.

[10] During the crisis, there were 11,054 new repossessions[10] cases in second quarter of 2008 compared with just 6,476 in the same quarter of 2007.

[11] 48,900 divided by 11.3 million.

[12] There were 7,700 properties repossessed in second quarter 2013 which annualises to about 30,000 a year divided by the 11.3 million mortgages.

[13] 8 August 2013 accessed May 2015. This is not a low figure however.

[14] Figures from 2000 to 2009 published at caculate to 19,022 , a comparable figure

[15] Some 586 repossession orders were granted by the circuit court in the first three months of 2015, compared with 95 in the same period last year, versus 90,000 mortgages restructured in the previous year.