Mortgage lending up in September

Gross mortgage lending rose marginally in September according to the latest figures from the Council of Mortgage Lenders, although it is still running at less than half pre-credit crunch levels.

The CML said that £12.5bn worth of loans were advanced in September, up 2% from August, and more than 28% from its low point of £9.7bn in February this year.

The CML said the bald figures were even better than they initially appeared for housebuilders, with a pick-up in house purchase activity off-set by the decline in remortgaging.

The figures mean that £38.9bn of loans have been made in the last three months, a distinct improvement on the first two quarters of the year. However this compares with quarterly lending of £98.6bn in the same period in 2007, before the credit crunch, a collapse of 61%.

CML economist Paul Samter said: “House buying remains weak on any historic comparison and is unlikely to rise much further.”

However, he said there were positive signs. He said: “It is encouraging that the wholesale markets have begun to thaw. Some of the UK's highly rated institutions have been able to issue structured finance products backed by mortgages in recent weeks. This is only an early sign of wholesale investors tentatively coming back into the new issuance market, but is welcome nonetheless.”