The Bank of England's cheap billions on offer through its Funding for Lending scheme continue to flood into the mortgage market, pushing lending to an 11-month high in December.
Mortgage approvals rose for the sixth month in a row to 33,636, slightly up on November and 9 per cent above the same month a year earlier, the British Bankers' Association said.
David Dooks, BBA statistics director, said consumers remain cautious, with outstanding personal loans at little more than half their peak in 2007-08. But he added: "Credit availability increased and pricing reduced towards the year-end as banks developed product offerings using the Funding for Lending scheme, which is expected to bring further benefits to households and businesses in 2013."
The initiative is helping to push down mortgage rates, and lenders are poised for a further "significant" increase in credit availability.
But experts remain sceptical of a long-term boost for the housing market. IHS Global Insight's Howard Archer said: "Housing-market activity is still relatively low and economic conditions remain difficult, which is likely to limit the upside for house prices. On balance, we expect house prices to be essentially flat during 2013."Reuse content