Mortgage lending at 28-month high
New mortgage lending in March was higher than it has been for 28 months, the Bank of England said today.
Not since November 2003 has as much money been leant to home-owners, with the Bank saying today that net mortgage lending rose £9.3 billion in March.
But while mortgage lending was up, unsecured borrowing on overdrafts, credit cards, and personal loans dropped to a 12-year low.
And this data - coupled with strong figures from Halifax this morning (full story) - is leading commentators to become far more optimistic about the state of the UK property market.
"Approvals, which are an indicator of housing market demand, are up 27.5 per cent from the same period last year, and have stayed above their long-run average level of around 100,000," said David Stubbs, economist with the Royal Institution of Chartered Surveyors (Rics).
Bank of England figures show new mortgage approvals in March were 116,000 when seasonally adjusted.
"The mortgage figures point to firm housing market conditions, and are backed up by evidence from Rics estate agents who report that enquiries from would-be buyers rose for a tenth consecutive month in March as well," Mr Stubbs added.
But while lending on homes was increasing, unsecured lending slumped.
Howard Archer, chief UK economist with the Global Insight consultancy, commented: "Very limited consumer credit in March indicates that consumers are still pretty keen to limit their use of credit cards, and find less expensive ways of financing their spending.
"Record high debt levels, rising unemployment and increasing pension concerns means that there is an increased need for many consumers to try and improve their balance sheets."
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