Gross mortgage lending recovers lost ground in May
Gross mortgage lending totalled an estimated £11.3 billion in May, according to new data from the Council of Mortgage Lenders. This represented a 12% increase from the £10.1 billion lent in April and was 1% higher than in May 2010.
Gross mortgage lending includes lending for both house purchase and remortgage. Despite a modest pick-up in overall lending activity during May, lending for house purchase is running below year earlier levels – as April Bank of England approvals data indicate.
Looking ahead, interest in remortgaging is now also likely to be less pronounced, as expectations of higher interest rates this year recede. The MPC once again kept rates unchanged at its June meeting – for the 27th successive month.
CML director general Michael Coogan comments:
“Gross mortgage lending in May recovered after low activity levels in April. Distorting effects from Easter and bank holidays cloud the current picture, but the likelihood seems to be for essentially flat levels of lending over the next couple of months.”
Notes to editors
1. The Council of Mortgage Lenders’ members are banks, building societies and other lenders who together undertake around 94% of all residential mortgage lending in the UK. There are 11.3 million mortgages in the UK, with loans worth over £1.2 trillion.
2. This month’s market commentary is available on the CML website.
3. The Council of Mortgage Lenders does not publish statistics for mortgage approvals. The data in our monthly Regulated Mortgage Survey and gross lending press releases relate to mortgage advances only. A mortgage approval is the firm offer to a customer of a specific amount of credit secured against a particular property. A mortgage advance is the total amount of loan actually provided to the buyer, by the lender.
4. Next month’s gross lending press release and market commentary will be published on 20 July 2011.