Although still far below normal levels, recent figures released by the Council of Mortgage Lenders (CML) gave hope of a return to healthier property market conditions.
The CML announced that the total amount of lending rose to approximately £13.5 billion last month, with the 5% increase attributed to an increase in mortgage granted to homebuyers as opposed to owners who are remortgaging from an existing deal. The CML did add that the rise in lending was aligned with typical seasonal increases and could not be a true indication of significant market improvement. Total lending in October last year was 27% higher at £18.46 billion.
Paul Samter, a CML economist, commented: “The coming months are likely to be dominated by seasonal factors rather than underlying change.”
In addition to the CML report, recent government data showed an 18% quarterly jump in housebuilding in the three months leading to September, reflecting the recent confidence boost that housebuilders have received from increasing house prices. Despite this rising optimism, experts have warned that the recent improvement in new home statistics would not be enough to meet the expect rise in housing demand.
Simon Rubinsohn, chief economist for the Royal Institution of Chartered Surveyors, added: “The numbers for 2010 should be a little higher, although, with development finance still constrained, we think it improbable that they will reach 130,000 [starts for the year], even with a recovery in the wider market.”
Source: Times Online
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