February gross mortgage lending 14.9bn, says BBA

Gross mortgage lending fell in February but was up 7% on the previous year, analysis by the British Bankers Association reveals.

In February gross mortgage lending stood at 14.9bn, well down on the 16.6bn seen in January.

There were 167,000 mortgages approved for all purposes in February.

Earlier house purchase approvals data has been re-stated from last months release to allow for the one-off cancellation of about 5,000 approvals in January.

The average loan approved for house purchase was 150,400, which is around 14% higher than a year earlier.

It has taken nearly four years for the average loan size to rise from 100,000 to 150,000, after having taken around nine years to double from 50,000 to 100,000.

Underlying net mortgage lending, which is calculated from gross lending minus repayments and redemptions, rose by 5.2bn.

This was less than the recent average of 5.7bn and Januarys increase of 5.4bn.

The annual growth in net mortgage lending continued at around 14%.

David Dooks, director of statistics at BBA, says: “The UK’s shortage of housing market supply is clearly evident in the mortgage approvals data.

The last 50,000 rise in the average house purchase loan has occurred more than twice as quickly as the previous 50,000 increase.

Demand appears to be moderating however, as the monthly number of house purchase approvals was lower than a year earlier for the third month running and net lending was below trend in February.

Reflecting tighter conditions for personal disposable income, consumer credit continues to be weak.”