Figures from the British Bankers’ Association reveal gross mortgage lending was £8bn in October, down from £8.3bn in September but 4% higher than in October 2010.
There were 35,295 house purchase approvals in October 2011, 5.4% higher than September and 16% higher than October 2010. The average loan value of £145,400 was similar to a year ago when it stood at £144,900.
Some 25,281 remortgage approvals were 2.4% higher than in September and 3% higher than in October 2010 when it was 24,493.
Unsecured consumer credit in October 2011 rose by £0.1bn from September to £86.5bn.
David Dooks, statistics director at the BBA, said: “The mortgage market remains subdued and demand for unsecured borrowing is slow reflecting householders’ caution in the current economic environment.”
Alex King, director at mortgage broker SPF Private Clients, said: "In some ways the debate is no longer about whether the glass is half full or half empty. The level of mortgage lending has been flatlining for so long, the glass has got a tidemark.
"With the economy so enfeebled and growth prospects so weak, it could easily be two years before the Bank of England dares to put rates up."
Duncan Kreeger, chairman of West One Loans, said: “The mortgage market is staggering on but it is battered and bruised. The protracted eurozone crisis and glacially-slow economic growth has handcuffed the high street banks.
“They are focusing on shrinking their assets to raise core capital, so appetite for growing their loan books has fallen almost completely off their radar. High loan-to-value mortgages are available but almost no one can qualify for them.
“As a result more borrowers, particularly property investors, are turning to bridging lenders who have stepped in to fill the space left by the wounded high street banks.
“Gross lending in bridging finance has risen 46% since the start of 2010. Annual growth in gross lending of 4% in the mainstream market is insipid by comparison.”
