Mortgage lending indicators across the board have shown a steady increase in mortgage lending through November.
Statistics published by the Council of Mortgage Lenders (CML), the British Bankers Association (BBA) and the Building Societies Association (BSA) all show a healthy increase in mortgage lending.
The market has been stimulated by both new homebuyers entering the market and home owners comparing mortgage rates and switching providers, say analysts.
“After the doubts about the health of the housing market expressed by some commentators earlier this year, the latest figures show a robust market,” said Adrian Coles, director general of the BSA.
“Loans advanced by building societies are up almost 20 per cent year-year and approvals, loans promised but not yet made, are up by over a third.
“The housing market has clearly recovered from the effects of the sharp increase in interest rates which peaked at 4.75 per cent in August 2004,” he added.
Figures released by the CML showed gross mortgage lending over November was up by five per cent on the previous month, standing at £28.5 billion, the second highest figure on record.
Analysts remained unconvinced that the flurry of activity would significantly boost house prices, however.
“Robust overall mortgage lending and approvals data indicate that housing market activity continued its recent firmer performance in November,” said Howard Archer of Global Insight.
“This is likely to put a floor under house prices, but we remain highly doubtful that house prices will move markedly higher any time soon.”
© Adfero Ltd