Big Issue calls for an end to repossessions

Tuesday 02nd of June 2009

There may be as many as 75,000 homes repossessed this year – destroying lives, families and communities. From today, The Big Issue is calling upon the government to freeze repossessions during the current economic climate – to prevent the onset of a social disaster

When a person or family loses the roof over their heads, the consequences are devastating. There are months of uncertainty leading up to a single repossession; there’s the humiliation of having bailiffs flanked by police officers evict you from your home; then there’s the anxiety and instability of being re-housed. The impact can be long-lasting, and for some it is a route to long-term poverty and substantial debt.

Today, The Big Issue, along with new campaigning group 38 Degrees, are calling on the government to freeze all repossessions during the current recession and to keep irresponsible mortgage lenders in check.

We are urging Big Issue readers to sign our petition, which we will present to Gordon Brown. We want the government to explore the alternatives to repossession and act to make the lives of thousands of people secure for the future.

“The government are busy bailing out the banks, but offering little to ordinary people,” says Big Issue editor-in-chief John Bird. “They have a moral responsibility to keep people in their homes. We cannot see people dragged into homelessness to then wait decades for them to get out.

“There has to be investment in the lives of individuals and families, otherwise they will be the ones filling our streets and our hostels: the places where people don’t keep their families or their sanity.”

Working alongside The Big Issue is 38 Degrees, a people-powered campaign group that launched last month in response to the growing numbers of people who feel let down by politicians, and unheard in the decision-making process.

Executive director of 38 Degrees, David Babbs, says: “Campaigning together is vital if we are to prevent the gulf between rich and poor deepening even further in the UK.

 “Repossessions are a disaster, whether we’re directly affected or not, and together we can put pressure on the government to do much more to stop them.”

The current economic crisis affects us all. It was sparked by a collapse in the housing market, but its origins go back further. Since the 1970s, successive gov-ernments have pushed home ownership, but it has come at a price. Deregulation in the banking sector has led to reckless mortgage-lending to the public. Now, rising unemployment and fluctuating interest rates have seen home reposs-ession rates double in England and Wales since 2008. Predictions for 2009 suggest that there may be as many as 75,000 repossessions. This is equivalent to 200 homes lost every day.

In the midst of financial collapse in September 2008, the government responded to the problem. They launched a £285m Mortgage Rescue Package designed to prevent the most vulnerable families in England and Wales losing their homes.

The scheme is twofold: struggling homeowners can receive a loan from a housing association borrowed against the value of their property, allowing their mortgage repayments to reduce; and a mortgage-to-rent scheme, where the debt is cleared completely by a housing association and the former homeowner pays rent to them at a level they can afford.

But critics’ fears were borne out last month when it was revealed that, due to the narrowness in eligibility, only one family in England had benefited from the measures since their introduction in January 2009. In Wales, 36 homeowners have benefited: not a promising start for the 6,000 people that communities secretary Hazel Blears pledged the emergency measures would help over the next two years.

Similarly, in December 2008 the government launched a secondary measure, the Mortgage Support Scheme, which aimed to help people who couldn’t pay their mortgage in the short term. Yet by April this year, half of the eight biggest mortgage lenders had refused to sign up to the scheme.

Rising repossession rates, however, don’t just affect the individuals and families whose security is shattered. There are broader negative social consequences, too.

A recent study by Glasgow University looked at the impact of repossession on communities. They concluded that clusters of repossessions can depress house prices in a local area, and, as the properties lie vacant, crime begins to thrive. 

The study also concluded that higher rates of repossession could further destabilise the banking sector resulting in a long-lasting and deeper recession.

Over the coming weeks, The Big Issue will examine repossession in its entirety, and map out the ways in which a moratorium could work. As well as examining the issues, we will also be calling on expert opinion from all sides of the debate.

“Together we can bring the issues to life, with coverage that reflects the reality of repossession for the people directly affected by it,” adds David Babbs. “If enough readers join us in this campaign we can make repossessions an issue politicians can’t ignore.

“Bankers’ mismanagement should not mean that we suddenly lose ground on things we’ve all spent years fighting for, like reductions in child poverty and rough sleeping, which rising repossessions could now threaten.”

Click here to sign our petition urging the government to freeze repossessions and keep irresponsible lenders in check.