Mortgage lending stable in August says CML

Lending figures for August suggest gross lending was stable although weaker than for the equivalent period in 2011.

Gross lending amounted to £12.6bn in August, according to figures from the Council of Mortgage Lenders today, representing a 1 per cent decline on the £12.7bn figure recorded for July. This latest data shows a 4 per cent decline in lending when compared with the £13.1bn loaned in August 2011.

CML chief economist Bob Pannell says: “House purchase activity continues to be a little above year-earlier levels, but the housing numbers are far from strong.

“We expect to see stronger take-up of NewBuy over the coming months, helped by a concerted marketing effort by builders and the recently launched Funding for Lending Scheme, which has prompted reductions in NewBuy mortgage rates. Both factors should stimulate buyer interest.

“The Funding for Lending Scheme is a bold move that has the potential to greatly influence the course of the housing market over the next year or so. While not a panacea for all housing market problems, the scheme does offer the potential to improve the lending environment. Unfortunately, it will be towards year-end before any initial assessment of its impact can be reached.”