Gross lending reaches 7-year high

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Gross lending reached a seven-year high in July, according to the Council of Mortgage Lenders.

Lenders advanced an estimated £22bn last month – 14 per cent higher than the £19.4bn advanced in July 2014 and 9 per cent higher than the £20.1bn advanced in June.

CML economist Mohammad Jamei says: “At £22bn, our estimate of gross lending in July is the highest monthly total for seven years, but is in line with our expectation that lending would strengthen in the second half following subdued activity earlier in the year.

“We expect lending activity in the rest of the year to be underpinned by improving economic fundamentals, but kept in check as any upward pressure on house prices further stretches affordability for some buyers.  Today’s data is in line with our forecast that gross lending will rise to £209bn this year, 3 per cent higher than in 2014.”

SPF Private Clients chief executive Mark Harris says: “With the uncertainty that plagued the housing market at the start of the year now out of the way, combined with lenders who are keen to do business, all signs point to a strong second half.

”Lenders have good capacity to lend and are offering extremely competitive rates, which are proving attractive to those buying and remortgaging.”