Mortgage lending climbs 5% in July

Thursday, 19 August 2010 12:00

Gross mortgage lending in the UK rose by five per cent between June and July to top £13.6 billion - but the market is likely to be slow for the rest of the year.

This is according to the Council of Mortgage Lenders (CML), which said the latest round of figures keeps overall borrowing for housing purchase and remortgaging on course to hit its forecast of £140 billion for 2010.

CML economist Paul Samter said despite the rise in monthly lending, business will be slow for the remainder of the year as underlying activity in the property market remains "subdued".

However, the situation looks fairly positive for existing homeowners, as record low interest rates have helped many to stay on top of their repayments and these conditions are set to continue "for some time yet".

The CML's figures come after the Department for Communities and Local Government said UK house price growth had dropped from 2.8 per cent in the first quarter of the year to 0.8 per cent in the second.

It put the average cost of a property at £210,775 between April and June.

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