Home loans up by a quarter
Mortgage lending jumped by 26 per cent during July as the housing market showed further signs of improving, figures showed today.
Around £16bn was advanced during the month, the highest figure for nine months and up from £12.7bn in June, according to the Council of Mortgage Lenders.
The group said the increase was further evidence of a modest improvement in the market after an exceptionally weak winter.
But it cautioned that activity still remained subdued by historic standards, with lending last month the lowest for July since 2001 and well down on the average of £27bn seen during the past seven years.
The CML said lending volumes had picked up in June and July as it had anticipated, due to the typically strong seasonal rise in activity over the summer.
It said the increase was likely to have been driven by a rise in people buying homes, as remortgaging activity continued to be limited by the low reversion rates people were put on to when their existing mortgage deal came to an end.
Paul Samter, CML economist, said: "Most of the indices point to house prices rising modestly over the summer months. The CML's July gross lending estimate of £16bn is the highest level in nine months and consistent with the rise in house purchase approvals.
"But the bounce-back in activity from the extreme weakness around the turn of the year, coinciding with a seasonal bounce, is limited in how far it can go against the current back-drop.
"We expect improved sentiment to support the market, but a further significant pick-up is unlikely with so many obstacles in place."
As a result, he said the group expected a slowdown in both lending volumes and property transactions during the latter part of the year, as a slow but more stable market emerged.
The Bank of England also released its monthly report on lending trends today, which showed the recovery in lending for house purchase had continued, but remortgaging activity remained "very subdued".
As a result, total net lending, which strips out redemptions and repayments, for July continued to be low.
The six major lenders questioned in the survey also said there had been no further improvement in the loan to value ratios they were prepared to lend on.
There had been signs that lenders were beginning to relax their lending criteria, reducing the size of the deposits they demanded in order for people to qualify for their best rates, as house prices stabilised. But this trend appears to have stalled.
Lenders also continued to raise the cost of their fixed rate mortgages during July, although several groups thought increased competition in the market may lead to lower margins being charged during the second half of the year.
On a brighter note, the groups reported an increase in the proportion of mortgages that were being approved, with the approval rate running at 80 per cent during July, up from around 70 per cent at the turn of the year.
There was also an increase in the number of mortgages being completed as property chains became less fragile.
The Bank's report also showed that lending to businesses declined further during July.
But lenders said some of the weakness was driven by a lack of demand as large companies raised money through the bond markets and by issuing shares.
Independent Partners: Get fee-free expert mortgage advice and find the right mortgage deal for you.
- 1 Disney heiress Abigail disowns her share of family profits in West Bank company
- 2 The secret report that helps Israel hide facts
- 3 'Women should not laugh in public,' says Turkey's Deputy Prime Minister in morality speech
- 4 Israel's propaganda machine is finally starting to misfire
- 5 HSBC closes bank accounts belonging to Muslim clients in the UK
The secret report that helps Israel hide facts
Woman and two children killed by mob in riots over 'blasphemous' Facebook post in Pakistan
A day in the life of Vladimir Putin: The dictator in his labyrinth
Putin is 'thuggish, dishonest and reckless', says British ambassador to US
Richard Dawkins tweets: 'Date rape is bad, stranger rape is worse'
Boozy, ignorant, intolerant, but very polite – Britain as others see us
- < Previous
- Next >
iJobs Money & Business
£450 - £650 per day + competitive: Orgtel: My client, a leading bank, is curre...
£350 - £400 per day + competitive: Orgtel: Senior Analyst, ALM Data, Halifax, ...
£500 - £600 per day: Orgtel: Java developer - Banking - London - Up to £600/d...
£400 per day + competitive: Orgtel: Liquidity Reporting - Basel III - LCR - Ba...
Day In a Page
A two-bedroom flat with boutique hotel-style interiors, close to the foodie haunt of West End Lane
A two-bedroom flat in a beautiful old vicarage, with many original features, close to the city centre
A three-bedroom 16th-century home with an aga kitchen, private gardens and heated outdoor pool, in Hadleigh
A three-bedrom home in sought-after Queen's Gate Mews, with Italian marble-finished bathrooms
Surrounded by glorious countryside in the village of Udimore, sits this impressive four-kiln oast and barn conversion
A five-bedroom house in the picturesque village of Kettlewell, north Yorkshire
An 18th-century former coaching inn with original staircase, open fireplaces and beams throughout
A Grade II-listed Georgian town house with three bedrooms and a south-facing courtyard, near Arundel Castle
Feel on top of the world at this über chic penthouse on the 37th floor of one of Europe’s tallest blocks.
A Grade II-listed Victorian villa with six bedrooms and two further cottages, all with spectacular sea views
A grade II-listed, Georgian cottage with mature 50ft garden, perfect for summer entertaining
A magnificent Georgian pile with turrets, seven bedrooms, a heated pool and four acres of gardens
Fairoak Farm has five bedroom suites, gym, outdoor swimming pool and golf course
Chic two-bedroom river-fronted flat with a private lift that delivers you directly to your home
A spectacular seven-bedroom Tudor pile, once owned by Henry VIII, with 18 acres of land
A seven-bedroom Georgian property previously used as a picturesque wedding venue
A split-level flat in a church conversion with two en suite bedrooms and 1,200sq ft of living space
A three-bedroom bungalow situated behind an impressive stone wall, £645,000
Windsor Castle overlooks this three-bedroom Victorian cottage located on one of Windsor's smartest roads
Chapel House is a former vicarage with nine bedrooms in the beautiful Upper Wye Valley
A five-bedroom B&B and separate owner's accomodation with potential for conversion
Enjoy summer by the Thames in this two double-bedroom converted warehouse in Rotherhithe village
A one-bedroom, luxury apartment with private gym and concierge service in Moorgate
A four-bedroom house in Hermitage Gardens with three reception rooms and landscaped gardens
A seven-bedroom Grade II-listed property with a separate self-contained apartment
A five-bedroom Victorian house with three reception rooms and galleried landing, £695,000
A six-bedroom farmhouse with five acres of land in a former cloth-making village
A secluded seven-bedroom detached house with large private garden, £490,000
A three-bedroom cottage overlooking Sarratt village green with open fires and solid oak floors
A three-bedroom maisonette flat in a Grade I-listed, Georgian townhouse in a sought-after location
A one-bedroom apartment located within a private gated development, north of Turnham Green
Look forward to a brighter future at two-bedroom Sunny Cottages, ideal for Londoners looking to downsize
A three-bedroom red-brick cottage with outbuildings and pretty gardens, £200,000
This three-bedroom flat within a former textile factory spans the corner of the fourth floor and has a balcony
A charming four-bedroom Oxfordshire cottage with oak floors and chunky-beamed ceilings, £465,000
A beautiful one-bed flat in a sought-after portered block, with access to Norland Square communal gardens
A one-bedroom flat within a Sixties school conversion with high-spec design and open-plan kitchen, close to Lambeth North Tube, £435,000