LONDON – Mortgage lending in the last month of 2005 was up by 25 percent as compared to the corresponding figures in December 2004, according to the latest report released by the Council of Mortgage Lenders (CML).

The total mortgage lending in December was pegged at 26.3 billion. “Confidence in the housing market was supported by the realization that short-term interest rates had peaked and the downward trend in fixed-term rates throughout much of the year, resulting in stable house prices,” said Michael Coogan, the CML’s director general.

“The second half of 2005 was characterized by strengthening housing market activity and increased mortgage lending. We expect this trend to continue into 2006 as mortgage approvals continue to rise.” However, the December figure was still six percent less than that of the November.

Analysts said that this was typical year-end slide. The CML report also said that despite fears of a huge dip mortgage lending totaled 287.5 billion in 2005, just 1 percent less than the 291.2 billion recorded in 2004. “The commentators who thought lending would fall sharply in 2005 based on the performance of the first half of the year were wrong,” Mr. Coogan said.

A concurrent release by the British Bankers’ Association said that the net mortgage lending in December increased by 5.4 billion; the biggest monthly increase since June 2004. Unsecured borrowing in the form of personal loans rose by 300 million as festive shoppers borrowed about 200 million on their credit cards.

But this figure was still below the half-yearly average of 500 million. “Mortgage lending strengthened in the final months of the year, but in sharp contrast, unsecured lending continued to be subdued,” said David Dooks, the BBA’s director of statistics.