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August mortgage lending down two thirds

The Council of Mortgage Lenders has revealed that mortgage lending for August was down by nearly two thirds on 2007 figures.

The CML says there were 42,200 house purchase loans in August, 15,600 of them to first-time buyers. At £6bn, the CML says house purchase lending was 63 per cent lower than in August 2007.

Both the number and value of house purchase loans were the lowest since the CML began collecting monthly data in January 2002.

CML director general Michael Coogan assured that the mortgage lending market will improve. He says: “The package of measures announced yesterday will have a positive effect, but it will take time for it to feed through to the mortgage market.”

The council found that there were 26,600 loans to home movers worth £4.1 billion in August, down 61 per cent from August last year. The typical home mover advance was £126,000, the lowest since June 2006.

There were also 74,000 loans for remortgage worth £10bn, down 20 per cent from August 2007. This is the lowest level of remortgaging volume and value since March this year.

Gross lending declined to £19.7bn, down 42 per cent from a year ago. This was its lowest monthly level since February 2005.

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