Spring bounce continues for mortgage lending

Recently released figures have suggested that the spring bounce seen in mortgage lending has continued, with the increase in mortgage lending continuing in May. According to the figures mortgage lending for the month of May was at its highest level so far this year.

The figures have been released by the British Banker’s Association, with the data showing that 36,709 mortgage loans were approved by major banks during the month of May for those that were buying a property. However, despite this encouraging data HM Revenue and Customs has released figures showing that for the past three months the number of completed property sales has remained flat.

The number of sales for May came in at 73,000, and this equates to around 1000 more than the numbers seen in March and April. These figures are higher than those seen a year ago, but are still far lower than figures from 2006, 2007, and 2008.

With regards to the increase in mortgage approvals members of the BBA have said that this is the third month in a row that mortgage approvals have increased, indicating that the spring bounce in mortgage lending is set to continue.

The BBA also said that in the current climate, with the base rate still at its record low of just 0.5 percent, many people were still focussing on paying off their debts rather than trying to save money, as they were able to save more on borrowing interest than they were able to earn on savings interest, making this a more favourable option.

David Dooks, Director of Statistics at the BBA, said: “The low interest rate environment is resulting in customers choosing to reduce or pay off borrowing, particularly personal loans, rather than saving.”

Tags: mortgage, borrowing, finance, Director of Statistics, british bankers association, debts, data, Mortgage loan