Record mortgage lending in December

Mortgage lending was up 25 per cent in December compared to the same period in 2004, the Council of Mortgage Lenders (CML) has announced.

The gross figure of £26.3 billion lent was a reduction on the amount lent in November, but the highest ever figure recorded for December.

The figures revealed that the record was achieved by people taking out bigger loans, not a greater number.

“The commentators who thought lending would fall sharply in 2005 based on the performance of the first half of the year were wrong,” said CML director general Michael Coogan.

“Confidence in the housing market was supported by the realisation that short-term interest rates had peaked and the downward trend in fixed-term rates throughout much of the year, resulting in stable house prices.

“The second half of 2005 was characterised by strengthening housing market activity and increased mortgage lending. We expect this trend to continue into 2006 as mortgage approvals continue to rise.”

He said that taking this in to account, house prices should remain resilient in the coming months.

© Adfero Ltd

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