Net mortgage lending rose significantly in July, despite demand for homeowner loans remaining "subdued".
That is according to the latest figures from the British Bankers Association, which indicated that banks' annual net lending for mortgages increased by 4.1 per cent last month, compared to 0.9 per cent in June.
Despite this rise, the association's statistics director David Dooks explained that gross mortgage lending remains stable and demand for homeowner loans is currently "subdued".
He explained: "The greater availability of properties for sale and slowing house price growth have not yet fed through to increased house purchase approvals.
"Consumer credit outstanding continues to reflect high repayments together with pressure on household finances and job uncertainty."
One area where the housing market has definitely subdued is in Scotland, where the latest Scottish House Price Monitor from Lloyds TSB Scotland indicates that recovery from recession has paused.
In the three months to the end of July, the average domestic property dropped in value by 2.9 per cent to £159,217, suggesting a lack of demand for purchases and subsequent mortgages.
In fact, the number of transactions in the Scottish housing market is estimated to be around half of pre-recession levels.
"The rise in Scottish house prices identified at the end of 2009 and spring of this year has stopped and has partially reversed," said Professor Donald MacRae, chief economist for Lloyds Banking Group in Scotland.
He pointed to the fact that activity is up from the lows seen during the winter months, but conceded: "It is clear that recovery from recession in the Scottish housing market has paused."
Meanwhile, a new report from financial research company Defaqto indicates that the average fixed rate charged for lifetime mortgages is increasing compared to long-term fixed rates.
The difference between the two was estimated to typically be 1.45 per cent in August 2010, up from 0.63 per cent in August 2007.
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