Mortgage lending continued to run at a seven-year high in November in a further sign of the strength of the market, according to the latest data from the British Bankers’ Association (BBA).
Meanwhile, non-mortgage lending to consumers saw the biggest jump in eight months, fuelling concerns that the cheap cost of credit is encouraging people to borrow more and save less to finance their spending.
The BBA said gross mortgage borrowing amounted to £12.8 billion last month, up by 28 per cent from a year earlier.
In October, gross mortgage borrowing stood at £12.9bn, and the BBA said the last two months have seen the highest monthly lending totals for seven years.
The BBA’s figures also show that 44,960 mortgage approvals with a total value of £7.9bn were made to home buyers in November, meaning there were 20 per cent more house purchase approvals in November than in the same month last year.
Meanwhile, net consumer credit borrowing increased by £713 million in November, the biggest upswing in eight months. The figure includes borrowing on credit cards, personal loans and overdrafts.
Howard Archer, chief UK and European economist at IHS Global Insight, said: “This will fuel concern that consumers are borrowing more and saving less to finance their spending, which is likely a consequence of relatively high consumer confidence and extended low interest rates. This is something that the Bank of England needs to keep a close eye on.”