Mortgage lending picks up again

Mortgage lending to home buyers picked up again in June, the Council of Mortgage Lenders (CML) says.

house pricesIts figures showed that there were 52,000 new loans granted to home buyers, 19% more than in May and up 14% on the same month a year ago.

The CML said activity was “still on an upward trajectory” and described the rise in June as “significant”. However, the lenders’ organisation said it was still cautious about the prospects for the coming months.

Meanwhile, there was a glimmer of good news on the buy-to-let front. While buy-to-let lending still remains very subdued, in the second quarter of 2010 the number of buy-to-let mortgages taken out was 13% up on the first quarter, and 15% higher than the second quarter of 2009.

Although business is only just over a quarter of its level of three years ago, both the number and the value of buy-to-let loans were at their highest level since the fourth quarter of 2008 (other than in the fourth quarter of 2009 – where demand was artificially inflated by the end of the stamp duty concession).

Commenting on the performance of the buy-to-let market, CML director general Michael Coogan said, “The buy-to-let market has continued to grow, albeit slowly, throughout the period since the credit crunch. And with fewer people able to afford the entry costs to home-ownership, as well as the pressure on social housing, tenant demand for private rented property will remain strong.”

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