UK Finance estimates that gross mortgage lending reached £22.1 billion in June. This is 9% higher than May’s lending total of £20.3 billion, and 3% higher than the £21.5 billion lent in June last year.
Gross mortgage lending for the second quarter of 2017 was therefore an estimated £60.3 billion. This is a 3% increase on the first quarter of this year and a 6% increase on the £57.1 billion lent in the second quarter of 2016.
UK Finance, the body that represents nearly 300 of the leading firms providing finance, banking, markets and payments-related services in or from the UK highlights that a period of belt-tightening now seems to be underway as inflation begins to erode consumer spending power, and consumer confidence weakens. Given that the economy and housing market are closely linked, this has contributed to the activity plateau since the start of the year.
Looking ahead, UK Finance suggests housing market activity is likely to reflect economic conditions – a deterioration would likely dampen first-time buyer numbers and homeowners remortgaging – the factors that have supported lending recently.