UK Finance: mortgage arrears fall again in Q1 as buy-to-let drops 24% year-on-year

UK Finance said residential mortgage arrears of 2.5% or more of balance fell to 79,110 in Q1 2026, down 2% on the quarter and 12% year-on-year, while buy-to-let arrears dropped 6% to 8,960 — 24% below a year ago. Lower fixed rates since late 2025 and steady wages have eased pressure on borrowers rolling off the 2023 peak. For sellers, fewer distressed listings means less downward drag on local pricing. Possessions still edged up, so this is improvement from a low base, not a turn.