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Mortgage lending increases by 5%

Mortgage lending increases by 5%

Category: Mortgages

Updated: 19/08/2010
First Published: 19/08/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Mortgage lending increased by 5% in July, although providers are still forecasting a sluggish market for the reminder of the year.

Figures from the Council of Mortgage Lenders (CML) show that a total of £13.6 billion was lent to consumers for mortgages in the month.

It represents a sizeable climb of 5% on the £12.9 billion figure in June, although it is 3% down from the £14 billion lent in July 2009.

Even with the figures showing encouraging growth in July, it seems an all out thaw in the market is unlikely.

The CML said that the results suggested that lending remains on track to meet the organisation's forecast of £140 billion for the year as a whole.

"It is difficult to see anything other than a slow market for the rest of this year as underlying activity remains subdued," said CML economist, Paul Samter.

"The rest of 2010 is likely to see rather lower lending and transaction numbers compared to the same period last year. Late 2009 saw a pick up as some home buyers looked to move before the end of the first stamp duty holiday.

"But for most home owners, the situation is not that bleak. The vast majority of households continue to pay their mortgages in full every month, and many have benefited from the record low interest rates. This looks set to continue for some time yet.

"While there are a range of risks to the outlook, low rates will further help most stay on top of their finances."

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