Encouraging lending figures

The August Council of Mortgage Lenders figures showed a 12% rise from July.  

A total of 55,300 loans were advanced for house purchase in August, worth £8.4billion, compared to 49,500 in July.

This is the largest number of loans advanced in one month since the summer of 2010.

Commenting on the latest CML Gross Mortgage Lending figures, David Whittaker, managing director of Mortgages for Business, said that whilst the figures were encouraging caution should be exercised: “We shouldn’t get ahead of ourselves though.

"This rise is like bringing a water pistol to a gun fight, it might look the part but it’s not going to save the day.”

Remortgage lending continued a downward trend, accounting for just 22% of gross lending compared to 33% in August last year.

Meanwhile, lending to first-time buyers rose by 14% in August compared to July and up by 18% on the same time last year.

Paul Hunt, managing director of Phoebus Software said: “Lenders’ efforts to bolster first time buyer activity are clearly having an effect, with more competitive mortgage rates and higher loan to values resulting in a significant jump in first time buyers’ loans since last month and compared to this time last year.”

Commenting on the data, CML director general Paul Smee said: “House purchase lending showed an encouraging rise in August but it’s unclear whether this reflects just the unravelling of previous factors such as the Jubilee and the Olympic Games, or a shift in the underlying picture.

“We will wait and see whether schemes such as Funding for Lending and NewBuy provide a further boost to the market in coming months.”

Andy Knee, Managing Director of LMS, one of the UK’s largest providers of outsourced property services hope that borrowers who may be holding back will start to take advantage of the current very attractive 3% deals offered by lenders such as HSBC, Leeds Building Society and The Cooperative.

Today's Conveyancer