GAGE lending barely budged in 2012 despite hopes that the economy could be recovering and government-led efforts to improve credit conditions, the Council of Mortgage Lenders (CML) revealed.
Total lending came in at an estimated £143bn for the year as a whole, hardly up on the £141bn recorded in 2011.
But the industry body estimates that lending will start to recover a little this year, forecasting a nine per cent rise in mortgages to £156bn.
“We are more positive about the UK housing market and wider economy than a year ago, despite economic headwinds and downside risks,” said the CML’s chief economist Bob Pannell.
“A key reason is that lenders currently face few funding pressures, in part reflecting the Funding for Lending Scheme (FLS).”
The FLS is a Bank of England scheme backed by the Treasury, giving cheap funding to banks as long as they promise to lend it on to households and consumers.
Although the forecast increase represents a solid rise, it is only increasing from a very low base level.
Before the financial crisis, lending was far higher – it peaked at £362bn, well over twice the level forecast this year.