CML: 'Mortgage lending up'

Gross mortgage lending increased in October, spelling good news for the mortgage market.

The Council of Mortgage Lenders (CML) says that lending reached £32.4 billion in the month.

That signifies a six per cent rise on the figure recorded in September and that seen in October 2006 (both £30.6 billion).

However, the CML did point out that the figures are taken from a time before wholesale funding problems began to affect the market.

"The next few months will be a testing time as ongoing pressures in financial markets feed through into the wider economy," said CML director general Michael Coogan.

"Funding constraints will continue to restrict lending activity and make loans more expensive.

"The Bank of England's recent Quarterly Inflation Report reinforced the likelihood of a reduction in rates early next year, and that should provide some relief for borrowers sooner rather than later," he continued.

GE Money Home Lending recently revealed that 89 per cent of mortgage brokers believe that the base rate of interest has peaked.

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