Mortgage lending slips as rents are pushed up to new record

 
Ben Southwood
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GAGE

GAGE lending slipped in August, while tenants were hit by still-climbing rents, two sets of data released yesterday showed.

Gross mortgage lending fell one per cent into August, the Council for Mortgage Lenders (CML) revealed yesterday – meaning lending was four per cent lower than August 2011. “The housing numbers are far from strong,” noted top CML economist Bob Pannell.

This gloomy picture was reinforced by the 1.2 per cent monthly jump in average rents, according to data from LSL Property Services, which brought rents in many regions to new highs. Londoners were at the top of the table, paying an unprecedented £1,074 per month on average – a rise of 4.9 per cent on 2011.

But Pannell at the CML was hopeful that government schemes would provide a boost to mortgage lending over the coming months, loosening up the tight housing situation.

“We expect to see stronger take-up of NewBuy over the coming months, helped by a concerted marketing effort by builders and the recently launched Funding for Lending Scheme (FLS),” Pannell said.

A chorus of analysts agreed that government schemes would be crucial in reviving the market.