Gross mortgage lending reached £22.1 billion in June - that’s nine per cent higher than in May and three per cent higher than in June last year, but some agents say the figure is not quite as promising as it might appear.
The new figures - from the new trade body, UK Finance - show that gross mortgage lending for the second quarter of 2017 was £60.3 billion. This is a three per cent increase on the first quarter of this year and a six per cent rise on the £57.1 billion lent in the second quarter of 2016.
UK Finance senior economist Mohammad Jamei says that despite the apparently buoyant result, the new figures show that a period of belt-tightening now seems to be underway “as inflation begins to erode consumer spending power, and consumer confidence weakens.”
He says that the housing market and the wider economy have seen an “activity plateau since the start of the year” and warns that first time buyer numbers could be dampened if the wider economy continues to be sluggish.
“These numbers are quite disappointing compared with this time last year when of course the market was in the doldrums to some extent following the introduction of the stamp duty surcharge” notes Jeremy Leaf, a north London estate agent and a former RICS residential chairman.
“Nevertheless, we are not noticing any signs of a bigger correction in the market but more balance between supply and demand while realistic buyers and sellers are getting on with their business at more realistic levels” he says.
UK Finance is a new trade association which was formed on July 1 to represent the finance and banking industry operating in the UK. It represents around 300 firms providing credit, banking, markets and payment-related services.
The new organisation brings together activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.