Research from the Council of Mortgage Lenders shows that gross mortgage lending reached a new record in July, totalling £34.4 billion.
Despite having fallen 1% compared with £34,847 in June, the figure rose 13% year-on-year from £30.6 billion in July 2006.
Director of statistics at the British Bankers’ Association, David Dooks, said: “Longer-term trends in mortgage lending are little changed but July’s strong rise was surprising, given the expected cumulative impact of higher interest rates. This resilience shows the popularity of home ownership and also reflects more remortgaging activity.”
The CML reports that, although there have been five increases in interest rates since last August, mortgage lending continues to be strong.
However, the full effects of the higher rates are not yet apparent. More people are choosing to remortgage properties in anticipation of further rates increases, and the coming months will reveal the extent to which higher rates have impacted the market.
This is expected to filter through to lower levels of mortgage lending toward the end of the year.
However, the CML believes that the £360 billion mortgage lending target for the year can still be attained.
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