Mortgage lending numbers falls in December, says BBA |
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Sat, 28 Jan 2006 14:05
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LONDON: There was a 30 per cent slide in the number of loans for new mortgages in December compared with November, while borrowing using credit cards and other means remained almost unchanged, according to the British Bankers' Association.
The BBA said December saw 51,233 mortgage approvals, against 71,310 in November. Analysts had forecast a decline to 67,000.
On a year-on-year basis, the figures are encouraging as they clearly indicate that the housing market is in for a revival. The number of mortgage approvals for all purposes, including remortgaging, went up 5 per cent during the year to 140,866.
BBA said seasonally adjusted net mortgage lending during December rose by 5.4 billion pounds, compared with 5.2 billion in November and 4.7 billion in November 2004.
BBA's director of statistics David Dooks said the annual total has been weaker in 2005 than in 2004 because of weaker mortgage lending in the first half of 2005. But, gross lending and loans approved for house purchase had shown an upward trend, after taking seasonal factors into consideration.
The BBA survey indicated hesitation on the part of consumers to borrow money as net lending on loans and overdrafts remained almost flat -- an increase of 0.1 billion pound in November. Net credit card borrowing rose to 7.74 billion pounds in December an increase of 3 per cent over November. But, when seasonal factors are considered, the net lending on this account stood at 0.2 billion pounds, a slight increase over the recent average, the BBA said.
Lending on personal loans and overdrafts totalled 2.5 billion pounds in December, which is a decline on the previous six months' average of 2.99 billion pounds.
Dooks said people are getting a lot more cautious about borrowing and "I can't see what would release those reins".
He said December had never been good month for people taking personal loans but December 2005 figures were weaker than previous years, which shows a general loss of appetite for borrowing.
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