Net mortgage lending increases by £1.6bn in January

High street banks’ net mortgage lending increased by £1.6bn in January, representing annual growth of 2.7%, according to statistics from the British Bankers Association.

Gross mortgage lending for the month was £8.2bn, slightly up on the recent six-month average of £8bn and 2% higher than in January 2010.

The number of house purchase approvals in January was marginally higher than the previous month at 28,932, compared to 28,907, but 29% lower than a year ago.

By contrast, the number of remortgage approvals was 5% higher last month than in December, and 28% higher than in January 2010.

David Dooks, statistics director at the BBA, says: “We are seeing little change in the borrowing environment for households or businesses at the start of 2011.

“The high street banks have seen more remortgaging activity of late as people look to fix costs.

“The banks’ mortgage lending growth continues to exceed the rest of the market.

“In both unsecured borrowing and company finance, the emphasis is on repayment rather than new borrowing.”