Regional gulf as house lending hits 2008 level

MORTGAGE lending in July leapt back to levels last seen five years ago, but some parts of the country are still yet to see any boost from the budding recovery to the housing market.

According to staggering figures released by the Council of Mortgage Lenders (CML) yesterday, gross mortgage lending rose to £16.6bn in July, the largest level since October 2008.

The amount of gross lending is up 29 per cent from the same month in 2012, and rose 12 per cent from June alone, following a deluge of evidence that an upswing in the property market is developing.

However, some parts of the country are still yet to see a boost from rising house prices or increased lending. According to research published today by LSL and Acadametrics Wales, Welsh house prices are still falling, down by £2,500, or 1.6 per cent in the last year, and losing £338 in value from May alone.

Property site Zoopla also reveals a similar regional gap today, finding that London homeowners were less likely to have to reduce the asking price when selling their homes.

Less than a quarter of London sellers have to reduce their asking price, while over 40 per cent of those in Barnsley, Wigan and Sunderland end up cutting their prices.

Ben Thompson of Legal & General’s Mortgage Club said: “At the moment it seems that the only way is up for the housing market”. He added: “It’s crucial that at every stage supply meets demand so that we have a balanced market that is not skewed and is accessible. The market needs to be sustainable and there is still a lot of work to be done to ensure that it is.”