New research commissioned by the Council of Mortgage Lenders (CML) shows that gross mortgage lending by banks, building societies and specialist lenders fell 6 per cent to an estimated £32.2 billion in August compared with £34.1 billion in July.
The figure was also 3 per cent lower than the £33 billion figure posted in August last year.
CML director general, Michael Coogan, said: "Lending fell slightly in August, but was still at very high levels. We see no obvious decline in consumer demand, although some decrease in the supply of lending is being experienced in the short term as a result of the problems lenders face in raising wholesale funding.”
Meanwhile, savings reached a record high in August, according to the Building Societies Association (BSA). Building society gross advances totalled £4.34 billion in August compared with £5.58 billion in August 2006.
Net advances were £656 million in August compared with £2.19 billion in August 2006, while approvals were £4.17 billion, down from £5.54 billion in the prior-year period.
Amazingly, building societies held net receipts of £1.39 billion compared with £399 million, while building society net receipts to cash ISAs were £124 million compared with £150 million in the same month last year.
Commenting on the mortgage figures, BSA director-general, Adrian Coles, said: “These figures confirm the slowdown in building society lending over the summer, as a combination of higher interest rates and robust lending criteria continued to bite.”
Commenting on the savings figures, Mr Coles said: “Building society net receipts in August were nearly double those in July. This is the highest August figure ever and the highest monthly figure since April 2005.”
“We believe that successive increases in interest rates and subdued equity markets have encouraged savers to put more money away, and we expect this to continue while rates remain high and savers recognise the wide range of good value building society savings products available to them,” he added.
Compare mortgage lenders
, Internet Savings Accounts
and loan companies