Mortgage lending was its highest last month in five years, say lenders.
The Council of Mortgage Lenders estimates that total gross mortgage lending increased to £17.6bn in October, representing a rise of 9% from £16.2bn in September and 37% higher than the total of £12.9bn in October last year.
This is the highest monthly estimate for gross lending since October 2008 (£18.6bn).
CML chief economist Bob Pannell said: “Housing activity is set to strengthen further in the short term and to contribute materially to overall economic growth.
“Combined with the Bank of England’s recent optimism about the economy, this has led some commentators to speculate that an early rate rise may be on the cards.
“We do not currently share this view, which we believe underplays the importance that the MPC attaches to a secure recovery before raising rates.”
In its separate figures for arrears and repossessions, the CML says a total of 149,400 mortgages, representing 1.33% of the entire stock of mortgages, had arrears equivalent to more than 2.5% of their mortgage balance at the end of the third quarter.
This was down from 154,900 (1.38%) in the second quarter, and 159,100 (1.4%) in the third quarter of 2012.
The repossession rate also fell from 0.07% to 0.06%. At 7,200, the quarterly number of repossessions was down from 7,600 in the second quarter and 8,200 in the third quarter of last year.
The CML figures cover both home-owner and buy-to-let arrears and repossessions. Arrears in the buy-to-let market are lower than in the home-owner market.
While buy-to-let mortgages represent over 13% of the total number of mortgages in the UK, the sector accounts for only 9% of the total number of mortgages in arrears. However, the repossession rate is a little higher on buy-to-let than on home-owner mortgages (0.10% on buy-to-let compared with 0.06% on home-owner-mortgages). Of the 7,200 total repossessions, 1,500 were buy-to-let.
Overall, the total number of repossessions for the full year now looks likely to be fewer than 30,000, compared with the CML’s start of year forecast of 35,000.
The CML’s current forecast of 37,000 repossessions in 2014 will also be revised downwards when the CML housing market forecasts for next year are published next month.
Comments
Its repossession not possession. Possession is something that we see Derek Acorha doing on the telly in haunted houses. The bank is repossessing as they already have possession as they own it and can take it back or enter your property pretty much whenever they want to, read the terms in your mortgage contract as they are quite an eye opener. They already own the house and will enter it or take it back based on provisions in the contract such as lack of payment / contact / under payment, sale without possession, no repayment vehicle in place and term ended or general breach of terms etc. In recent times of course they are reluctant to enforce on anything except lack of payment but repossession does take place on other criteria. So there you have it, its repossession.
Please
Possession not repossession the lenfer never owned it - unless they are possessing for the second time!!