Quality Speaks For Itself

UK mortgage lending rose three times faster than predicted in December…………….

Posted in Financing by Ash on January 30th, 2009 12:31pm

These lending figures come as a surprise in a week of gloomy economic data.

Net lending, which strips out redemptions and repayments, doubled to £1.9bn during the month – the biggest rise since July 2008. The number of mortgages approved for house purchase also increased after hitting a new record low in November. Approvals were at 31,000, up from 27,000 during the previous month.

Sterling immediately leapt at the news, pushing the euro below 90 pence for the first time in eleven days.

The increase is all the more surprising as activity we would normally expect activity to tail off if December in the run up to Christmas. However, lending is still considerably down on the previous year, with December’s figure only a quarter of the level seen 12 months earlier.

While the data may be a sign that banks are gradually becoming more prepared to lend, mortgage lending levels are still very weak. We await mortgage data for the coming months with interest.