Surge in mortgage lending ‘short-term’

A rise in the amount of mortgage lending in December by mutuals was probably a one-off, it has been claimed.

Building Societies Association (BSA) figures indicated that the total gross lending for homebuyer loans was £1.8 billion in December, compared with £1.6 billion in November.

However, this increase can be attributed to people seeking to “rush” through deals to buy homes valued between £125,000 and £175,000 before the end of the stamp duty holiday, according to BSA head of mortgage policy Paul Broadhead.

Noting that lending over the course of 2009 was half what it was in 2008, he added: “It is likely to remain at low levels until funding conditions improve.”

The comments come as the Bank of England’s figures for net lending to individuals suggested a mixed picture in the final month of 2009.

It said that while the net rise in lending of £1.2 billion was less than the £1.6 billion jump in November, the increase was above the six-monthly average increase of £0.9 billion.

Leave a Reply

Your email address will not be published. Required fields are marked *