Mortgage lending 'on the up'

Mortgage lending from banks increased in the 12 months to September, according to new data from the British Bankers' Association BBA.

Over the year, net mortgage lending rose 1.6 per cent while gross mortgage lending rose seven per cent in September compared with a year ago. This may be related to people being able to find more deals with favourable mortgage rates.

However, economists have suggested that the market is still stagnant really as mortgage approvals dropped six per cent between August and September, falling to a three-month low. However, approvals were at a 15-month high in August.

The average value of home loans handed out in September was £142,600, a similar amount to September 2010.

“There is little evidence that housing market activity is really shifting up a gear even though it has improved since the start of 2011,” said Howard Archer of IHS Global Insight.

The BBA suggested that mortgage activity in the past year may have been stimulated by growth within the buy-to-let market.
 

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2011-10-26 11:31:00 © Moneyextra.com