UK buy-to-let RMBS performance improves in May
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The performance of the UK buy-to-let residential mortgage-backed securities market improved in May, according to Moody’s Investors Service.
In the three-month period to May, the 90 day plus arrears rate decreased from 1.96 per cent to 1.83 per cent. During this period, outstanding repossessions remained stable at 0.14 per cent and cumulative losses increased slightly to 0.43 per cent from 0.38 per cent.
Moody’s forecasts that the Bank of England base rate will increase by 0.25 per cent by the end of 2011 and by a further 1 per cent during 2012, bringing the rate to 1.75 per cent by the end of next year.
It believes prime UK BTL borrowers will be able to cope with these interest rate rises.
The ratings agency predicts house prices will remain flat for the next 18 months and the number of house purchase transactions to remain well below the long-term average.
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