Mortgage Approvals Up But Lending Remains Weak
The overall value of mortgage lending remained stagnant in July according to the British Bankers Association, but the number of mortgages approved did rise slightly.
Figures published on Tuesday by the BBA showed high street banks lent £7.6 bn in July, the same as in June.
BBA statistics director, David Dooks said: “Demand for borrowing from both households and companies continue to be weak reflecting the slow growth in the economy.”
“The high street banks have provided almost three-quarters of all new mortgage lending during the last two years when the mortgage market has been very subdued," he added.
But while the overall amount of money lent remained the same, the 74,590 mortgages approved in July was an improvement on the 71,521 approved by banks in the previous month.
However much of that growth could be put down to an increase in the number of people re-mortgaging their homes.
In July 26,043 applications for a re-mortgage were approved by the banks, compared to 24,311 the previous year.
The average value of the mortgages granted also rose from £149,700 to £151,500.
Rick Salmon from the BBA said the figures suggested the lending market was “bumping along the bottom” rather than showing any great strength,
“There are always people who need to move and need to buy and sell and obviously re-mortgaging, you have to do it every couple years,” he said.