The Council of Mortgage Lenders has released figures today estimating that gross mortgage lending reached £21.8bn in October – 8% higher than September’s £20.1bn.
This is a massive 19% higher than the £18.4bn of lending recorded in October 2014 and is the highest monthly figure since July 2008.
Bob Pannell, CML chief economist, said the recovery looks set to continue until the end of 2015 with the factors helping support it continuing to be low inflation, strong wage growth, an improving labour market and competitive mortgage deals.
He added: “As a result lending this year is likely to exceed our forecast of £209bn, though affordability pressures will limit business volumes for first-time buyers and movers, meaning that we think the market has only modest further upside potential over the short-term.”
Brian Murphy, head of lending at Mortgage Advice Bureau (MAB), said that this growth in lending has been driven by favourable market conditions:
“Borrowers are now able to take advantage of a growing number of highly competitive mortgage products, with the total number increasing 10% between August and September alone.
“Would-be homebuyers have the benefit of increased lender appetite and rock bottom mortgage rates. Although the goalposts have been moved many times as to when a rise in the Base Rate may or may not occur, one thing is certain – these types of rates won’t be around forever. Existing mortgage borrowers can also benefit by swapping to a new product, with some lender’s standard variable rates offering poor value.”