The latest figures from the Council of Mortgage Lenders (CML) show gross mortgage lending has risen 5% in November, the most since July 2004.
Lending activity usually slows down towards the end of the year, so November’s increase of 5% to an estimated £28.5bn, indicates a robust underlying picture.
The CML says the strength in lending continues to reflect the recovery in housing market activity over the past year, supported by high levels of remortgaging, while the Bank of England approvals figures show remortgaging activity to have been at record levels in recent months, driven by rising numbers of fixed-rate deals maturing and consumers therefore looking for a new deal.
Michael Coogan, director general of CML, says the housing and mortgage markets have clearly strengthened significantly from the lows of a year ago, as there have been upward trends in gross mortgage lendng and approvals, and more stable house prices in recent months.
He adds: “While it could be tempting to assume this strengthening will continue, our expectation for the coming year is of relatively subdued transaction levels, mortgage lending moderating a little from recent levels, and house prices rising about 2%.”
Meanwhile the figures from the British Bankers’ Association (BBA) show net mortgage lending rose by an underlying £5.1bn in November, a huge increase on October’s rise of £4.3bn.
David Dooks, BBA director of statistics, says: “November’s above-average rise in mortgage lending reflects the recent upturn in approvals and provides more evidence that the mortgage market bottomed out in the summer and is now being underpinned by steady demand.”
Adrian Coles, director general of the Building Societies Association comments: “After the doubts about the health of the housing market expressed by some commentators earlier this year, the latest figures sow a robust market. Loans advanced by building societies are up almost 20% year-on-year and approvals are up by over a third.”
If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Nyree Stewart on 020 7968 4558 or email [email protected]IFAonline
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