Mortgage market commentary from UK Finance
Figures just released by trade association, UK Finance, show that gross mortgage lending in August hit £24.2 billion, of which £15.1 billion was lent by High Street banks. House purchase approvals by the banks reached 41,807 in August, stronger than the monthly average of 41,133 over the past six months and 11% higher than the same time last year when the market was hit following the surprise EU referendum result.
UK Finance data also shows that consumer borrowing slowed to 1.5% in August, down from 1.9% in July. Non-financial companies’ deposits are growing annually by 8.7% as businesses hold cashflow, the data reveals.
Commenting on the data, UK Finance’s Senior Economist Mohammad Jamei said, ‘Housing market activity is in Goldilocks territory, growing only modestly since the start of the year, though the mix of activity has shifted towards first-time buyers, away from buy-to-let and cash. There is also some rebalancing across regions, as activity picks up in the north of England, Wales and Scotland, away from London, the south east and east Anglia.
‘Despite resilience in consumer spending, annual growth in consumer credit has been slowing over the last few months. Across the UK some households have opted to save a little less, whilst others have not increased their borrowing. Meanwhile, there has been growth in business deposits as non-financial companies hold cashflow and reserves amidst broader uncertainty in trading conditions.’
UK Finance is a new trade association, which was formed on 1 July 2017 to represent the finance and banking industry operating in the UK. It represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation brings together activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.