29 Jun 2009

Mortgagee sales continue to increase

8:03 am on 29 June 2009

Data from a property information company suggests home mortgagee sales are the highest in 15 years.

Terralink says there were 251 forced sales in April, compared with 90 in the same month last year.

The figure is the highest Terralink has ever recorded and it says the increase is getting steeper month after month with no sign of decreasing.

The data shows forced sales feature most strongly in Auckland.

The company's managing director Mike Donald says property owners are struggling in the recession.

He says 4.5% of all sales are now mortgagee sales, where as in previous years mortgagee sales only comprised about 0.1-0.2% of all sales.

Mr Donald says 60% of owners in the sales own more than one property, which is probably a sign they have over-committed themselves.

ANZ National's chief economist, Cameron Bagrie, says the increase in mortgagee sales is caused by rising unemployment and decreasing house prices.

Mr Bagrie says mortgagee sales will continue to rise through the year, and it's likely rural areas will also be affected.