Mortgage lending rises

Published on Thursday 20 November 2008 21:17

MORTGAGE lending improved last month but remains substantially lower than a year ago, the Council of Mortgage Lenders revealed yesterday.

It said that gross mortgage lending was up 6.9 per cent in October to 18.7 billion, from 17.5bn in September. It was the first monthly increase since July and the biggest since April, although lending was down 44 per cent from the 33.3bn of the same month last year.

October was still one of the worst months on record, said Howard Archer, chief UK and European economist at Global Insight.

"At best, it can be said that housing market activity is stabilising at an extremely low level as credit conditions remain tight, housing affordability remains stretched on a number of measures, the economic downturn deepens and many people hold off from buying houses due to the belief that prices still have a long way to fall."

The CML said housing and mortgage markets would remain weak in the coming months due to the continued shortage of funding and the worsening economic outlook.