* August saw gross mortgage lending total £16.1bn, some 12% higher than August last year. With redemptions and repayments stripped out, the resulting rise in net lending, seasonally adjusted, was £5.3bn, slightly below July’s very strong rise of £5.5bn.
* In total there were 268,200 mortgage loans approved in August, slightly fewer than in July, though 26% more than in August last year, with a total value 56% higher. Loans for house purchase accounted for 37% of all approvals and 52% of their total value, both proportions being the highest for over a year. The average house purchase loan again rose markedly, to £109,600 some 25% higher than a year earlier.
* Total net consumer credit rose by £0.8bn in August, very close to the recent monthly average, and continuing below last year’s growth.
David Dooks, BBA director of statistics, said:
"The overall picture from these figures shows borrowers’ confidence in the housing market holding up. Though the demand for remortgaging and equity withdrawal eased back in August from the July figures, the higher volume of loans approved for house purchase in July was repeated in August. The average value of these loans was some 25% higher than a year ago, suggesting a certain resilience in house prices. Given the continued demand for mortgages, lending is likely to remain strong in the near term.
Personal loan growth remains generally weaker than the increases seen during 2001/02, partly due to substitution by equity withdrawal, whilst a large proportion of new credit card borrowing continues to be offset by repayments, as individuals are generally using their cards as a method of deferring payment."
Mortgage Lending
Gross lending totalled £16,074mn in August, some 5% less than July’s £16,903mn, though 12% more than in August a year earlier.
* August’s seasonally adjusted rise in net lending of £5,253mn was 5% lower than July’s £5,502mn and closer to the average of +£5,000mn over the previous six months.
* August last year was a relatively weak month for loan approvals, so comparisons of this year are particularly striking. Approval of house purchase loans were 29% higher by number and 61% higher by value; remortgaging loans were 25% higher by number and 55% higher by value; and equity withdrawal loans were 25% higher by number and 37% higher by value.
Consumer Credit
* New borrowing on credit cards totalled £6,459mn in August, 9% more than in August 2002. However, with the level of repayments equivalent to around 95% of new lending, the seasonally adjusted increase in net lending of £386mn was very similar to July’s rise of £395mn.
* New lending on personal loans and overdrafts, at £2,999mn, was virtually the same as in August last year. After seasonal adjustment, net lending rose by £408mn, virtually the same as the average monthly increase over the previous six months.
