Bank lending on mortgages is on the rise

MORTGAGE lending rose over the twelve months to September, according to figures out yesterday from the British Bankers’ Association, though at a slowing rate.

Growth of 1.6 per cent was recorded in net mortgage lending over the last year. Gross mortgage lending came in seven per cent higher in September than a year ago, at £8.4bn.

However, analysts believe the overall trend in the housing market is one of stagnation, as mortgage approvals fell from 35,069 in August to 33,130 in September.

“There is little evidence that housing market activity is really shifting up a gear even though it has improved since the start of 2011,” said Howard Archer of IHS Global Insight.

Meanwhile, credit card debts have risen in every month since May. Although repayments exceeded new borrowing by £219m last month, net debts actually rose by £196m due to interest being added to accounts.

However, the decline in borrowing by non-financial corporates slowed.

From July 2009, borrowing levels fell by up to 5.8 per cent annually. That decline has slowed, falling to 3.5 per cent in the year to September.

“There is low demand for credit and many companies are looking to pay down debt,” said Archer.