CML: Gross mortgage lending up 10%

Gross mortgage lending reached an estimated £13.4bn in August, a 10% rise from £12.1bn in August 2010, according to the Council of Mortgage Lenders (CML).

The trade body said August's figure was also 6% up on the £12.6bn lent in July.

CML chief economist Bob Pannell said: "Much of the recent variation in monthly lending figures appears to have reflected seasonal factors, with the underlying picture being one of activity levels that continue to be subdued but broadly stable.

"The August performance more or less offset the weaker than expected July figure. Taking July and August together, lending has shown little change on the same months of 2009 and 2010."

Brian Murphy, head of lending at the Mortgage Advice Bureau, added: “More mortgages are being taken out for the simple reason that rates have become far more attractive in recent months and lower house prices are stimulating people to buy.

"The economy is still delicate and confidence is far from robust but increasingly there are more reasons to buy than not to buy, especially with interest rates now looking to be set in stone for at least another year.

"The market, as the CML rightly observes, is still down historically but it is by no means out."