Print friendly version 26 Aug 2008

Mortgage activity low continues

Mortgage lending rose by £4.3bn in July 2008, equal to the previous month's figure, according to the British Bankers' Association (BBA).

The latest figures from the BBA showed mortgage lending rose by £4.3bn in July, compared to an average of £4.8bn over the previous six months – the increase in June was also £4.3bn. House purchase approvals continue to be low – totalling 22,448 in July, a 65% decrease on last year. The number of loans for remortgaging fell by 21% since last year, and dropped from 58,624 in June to 54,232 in July 2008.

David Dooks, statistics director at the BBA, said: “The monthly numbers of approvals for house purchase, which have fallen by some two-thirds over the last year, levelled off in July. It would, however, be premature to think that the housing market will now start to recover, because overall approval activity continues to be very low.

Consumer credit (borrowing via credit cards, personal loans and overdrafts rose by £0.1bn in July to total £108.6bn, and personal deposits and savings rose by £0.8bn, continuing a pattern of weaker growth in this area.

Dooks added: “The pressures on household budgets are reflected in the relatively weak rise in individuals’ deposits and, with consumer borrowing growing only slowly it seems that consumers are acting prudently.”

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