You are here: Home - Uncategorized -

Mortgage lending breaks new record

0
Written by:
25/07/2006

Mortgage lending reached a record high of £32.2bn in June, an increase of 30% on June 2005. Paula John reports.

According to figures from the Council of Mortgage Lenders (CML), total lending for June 2006 beat the previous record high of £29.1bn set in May by £3.1bn.
 
The industry body said lending levels were attributable to a combination of elements: the seasonal rise in house buying as the summer began, strong house price inflation, particularly in London, and high levels of remortgaging.
 
“Record levels of lending have been achieved in nine of the past 12 months,” said CML director general Michael Coogan. “Demand for houses and remortgages remains strong, so we expect to see continued robust lending during the summer months.”
 
Figures from the Building Societies Association (BSA), backed up this picture of a buoyant housing market.
 
It reported that building societies had approved a record £6bn worth of homeloans in June this year, compared with £4.3bn in June 2005.
 
However, both institutions sounded a note of caution, warning that the likelihood of a rise in interest rates in the second half of the year could well serve to dampen the housing market to a degree.
  
The CML’s Coogan said that the “risk of an interest rate rise seems more real than earlier in the year”.
 
A third report from the British Bankers’ Association (BBA), said banks’ mortgage lending in the first six months of the year was 18% higher than in 2005. But total mortgage business written inn June showed an annual increase of £5.6bn, down from a £5.8bn increase in May.
 
The likelihood of an interest rate rise increased with evidence that the recovery on the high street also pressed ahead during June, with retail up 3.7% over June 2005, much higher than the 2.9% forecast.
 
Some experts believe the Bank of England could raise interest rates by August. But Bank governor, Mervyn King, said policymakers would wait for any World Cup effect on retail sales to pass before deciding on interest rates.

Tagged:

Tag Box

Debt

Pension

Spending

Financial fitness

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Which ISA is right for you? A round up of the six products available in 2017

From cash to innovative finance to lifetime, here's our guide to the ISA products available to savers this yea...

Guide to buy-to-let tax changes

In late 2015, former Chancellor George Osborne announced a range of  tax measures aimed at landlords, which t...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Five fund tips for a 0.25% interest rate environment

With interest rates stuck at a record low 0.25% and expectations rates could fall to close to zero, here are ...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

Investing your money

Alliance Trust Plc gives you smart insight into how to invest your money

Money Tips of the Week

Read previous post:
UK pensioners in debt

The UK’s retired are struggling with their finances, says Christina Jordan. Could an equity release scheme be the answer?

Close