Mortgage lending on the increase

The latest figures from the Bank of England show December marked the fifth consecutive increase in lending with 55,785 mortgages approved.

The average for the previous six months was 50,058. This was the highest number of approvals since January 2012, possibly showing that the government’s Funding for Lending scheme might be starting to have an effect on the market.

In 2012 gross mortgage lending by building societies and other mutual lenders was £30.7 billion, up by 30% compared to 2011.

Mutuals took a 22% market share of gross lending in the year, up from 17% in 2011. In the final month of the year gross lending by mutuals was £2.4 billion, up from £2.1 billion in December 2011.

Mutuals approved a total of 281,000 loans in 2012, up 20% compared to the 233,400 in 2011.

Adrian Coles, Director-General, Building Societies Association, said: "Mutual lenders such as building societies are likely to continue to play a prominent role in the mortgage market in 2013, helped in part by the Bank of England’s Funding for Lending Scheme.

“Well over half of the 35 firms signed up to the scheme in December are mutuals. The full potential of the scheme and its benefits to homebuyers will be demonstrated as the year progresses.”

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