MORTGAGE lending rose by two per cent in September, although the total amount lent was still 27 per cent lower than in the same month last year.<br /><br />Official figures from the Council of Mortgage Lenders (CML) show £12.5bn was lent for mortgages in September, thanks to recovering levels of demand for housing. The figure compared to the £12.295bn of lending seen in August. <br /><br />The CML said gross lending in the third quarter of 2009 amounted to £38.9bn, an 18 per cent increase on the second quarter, but down 26 per cent on last year. <br /><br />Meanwhile, the National Institute for Economic and Social Research (NIESR) said Britain’s economy would return to growth in the final quarter of 2009 before rising 1.3 per cent in 2010.<br /><br />But the leading think-tank estimates that the recession will have permanently reduced the UK’s potential output by four per cent, compared to an average of three per cent of the European countries. <br /><br />Compared to the world economy, which is forecast to grow by 2.8 per cent in 2010 led by emerging Asia, the NIESR sees a feeble recovery ahead for the UK. <br /><br />Consumer spending will continue to fall through to 2011 as households save more, it said.