Record mortgage lending, but not by building societies

20 August 2007

Mortgage lending reached a new record in July, according to figures from one industry body.
The Council of Mortgage Lenders (CML), which represents banks, building societies and other lenders, said that although gross mortgage lending fell in July by 1% from June’s record high, at £34.4 billion it was 13% higher than the £30.6 billion lent in the same month last year.

The CML continues to predict that mortgage loans will total a record £360 billion in 2007. It says that mortgage lending remains robust, but warns that the market is yet to see the full impact of the past year’s interest rate rises.

Meanwhile, figures released by the Building Societies Association (BSA) show that at £4,465 million, gross building society lending fell in July by 9% compared to July 2006. Mortgage approvals, regarded as a good indication of future lending, fell for the second month running.
Explaining the apparently conflicting figures, BSA spokesperson Neil Johnson told Charcol News: “Since building societies are funded by their savers, they have to take a cautious approach to lending to ensure that they do not lose their depositors’ money.”

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