Official figures show new mortgage lending up 4%

Official figures show new mortgage lending up 4%

The Bank of England has reported a 4% rise in the number of mortgages approved for house purchases in March, following on from a 19% increase in February.

New home loans sanctioned during the month totalled 39,230 with the figure 20% above the previous six month average.

As with any sign of recovery in the housing market, analysts are wary of declaring that better times have arrived, especially as earlier this week the British Bankers’ Association reported that mortgage approvals for house purchases fell by 7% in March.

Commenting on the figures from the Bank of England, the Council of Mortgage Lenders said it was cautiously optimistic that it may be possible to revise its current forecast of negative net lending (gross lending with repayments and redemptions stripped out) of £25 billion for 2009.

However, the body described prospects for any sustained improvement in net lending as “only modest”.

According to the CML: “All lenders continue to face ongoing funding constraints, but at the same time consumer demand is also far from certain. With further increases in unemployment expected, and with all the uncertainties that still remain over house prices, no-one should be surprised if there is a sustained period of relatively subdued lending volumes for some time.”

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